Hawaii Tax Foundation Prez Poses Questions about Legalized Gambling in Hawaii

Can Legalized Gaming Fill Hawaii's Budget Hole
12.18.2011

By Lowell Kalapa
President, Tax Foundation of Hawaii

At its most recent meeting, the State Council on Revenues downgraded its outlook for Hawaii’s economy by dropping its forecast of economic growth from 6.7% to 5.2% for the current fiscal year.

Although the overall growth rate in general fund tax revenues was pegged at 14.5%, 4.3 points are attributable to the catch up of the delay in state income tax refunds from two years ago and 5 points are attributed to the changes in state tax laws that are expected to produce about $200 million less in new revenues than the legislature had counted on when drawing up its financial plan for the fiscal biennium.

These latter tax law changes are good only for the current and next fiscal year and, therefore, added revenues from that source will disappear in fiscal year 2014.

It should also be noted that the Council’s adoption of the added revenues from tax law changes is substantially less than what the legislature had assumed when they adopted those changes. The difference amounts to approximately $100 million for each of the two fiscal years. Therefore, even without any spending restrictions or other adjustments to the recently approved biennium budget, the state-spending plan will be under water by almost $200 million over the fiscal biennium.

Given that situation, lawmakers will be searching for additional revenues in order to avoid making additional reductions in spending. The will to adopt additional tax increases will be absent given the fact that all legislators will be up for reelection in 2012 as a result of the decennial reapportionment of the legislative districts.

Thus, many observers believe that the legislature will actually turn its attention to a number of gaming bills that were introduced during the 2011 session and to some extent received considerable attention. There is no doubt that gaming might be looked upon as a potential resource to fill in the budget gap.

On the other side, again, is the fact that next year is an election year and the public is deeply divided on the issue of gaming, especially in the House where each representative has a smaller constituency in his or her district and where a few votes one way or the other could win or lose the election. In addition, as with all levels of government pushing to downsize payrolls, the additional monitoring and regulation of gaming activities may work against adoption of the activity if it means added personnel costs for the public sector even though there may be additional revenues from gaming.

Then there are those who are concerned about the potential social problems that gaming in Hawaii would create. We all chuckle every time someone mentions going to “Vegas” or enumerates the number of trips made to that ninth Hawaiian Island. It is a matter of fact that Hawaii people like to gamble and at least the time and expense of traveling to Las Vegas stands as a barrier to those who financially cannot swing the trip and probably can’t afford to lose the money.

The question that lawmakers and taxpayers need to ask is whether or not the additional revenues lawmakers believe will come from adding gaming to the list of revenue resources will outweigh the additional costs that will come with gaming. While gaming, per se, is not a tax, it has tax implications from the standpoint that it will require additional public programs - those that are needed to operate the gaming activities including the legal enforcement and those that will be needed to address the social and financial implications.

Another consideration is the amount of participation that will be needed to make a gaming industry a lucrative source of public revenue. Unlike its counterparts on the mainland which allow gaming, Hawaii is not contiguous with other jurisdictions where residents from other states or counties can cross state lines to participate in the gaming activity of another state or county. Think of it in the reverse of Hawaii residents traveling to Las Vegas. Will the cost, time and distance be attractive enough to gamble in Hawaii?

Finally, the adoption of any form of gaming in Hawaii may open the door to forms other than what may be authorized by the legislature because of the Hawaiian sovereignty issue giving rise to those other forms of gaming on native Hawaiian enclaves such as Hawaiian Homes Lands.

Ilitch Unlikely to get Taxpayer Subsidies for a New Detroit Hockey Arena

New Detroit hockey arena likely faces funding hurdles
Unlike Comerica Park, Ford Field, public money likely a tough sell this time around
10.22.2011

By Louis Aguilar

When Detroit Red Wings and Detroit Tigers owner Mike Ilitch recently pledged again to build a new arena in downtown Detroit, economic analysts said it was not an empty promise.

Despite an uncertain economy and a lack of public appetite for sports facility subsidies, building an arena in Detroit is still doable, but would require some creativity, they said.

"He's going to have to make a dramatic statement of faith in Detroit again to build a new hockey arena," said Scott Watkins, an economist for Anderson Economic Group in East Lansing, who has done analyses on building sports venues. A new hockey arena would cost an estimated $300 million to $400 million to construct.

"Mr. Ilitch and Red Wings fans see Hockeytown — a city and region very loyal to professional hockey," Watkins said. "What global lenders see is a risky investment. Their view is there would be no guarantee that for 10, 20, 30 years a hockey franchise can be supported in an area with declining population and declining income."

The hockey arena has been a long quest. Ilitch for five years has actively explored building a new arena downtown to replace the 35-year-old Joe Louis Arena and more recently said he wants to construct such a facility. The hockey team and city-owned Joe Louis Arena are still negotiating an extension of the lease.

"Like I've stated before, we're gonna have a new arena," Ilitch told The Detroit News last month during an exclusive interview. "That's the best thing I can say." On Friday, Ilitch Holdings announced that Eric Larson, an A-list real estate developer with a long track record of high-profile deals, is now in charge of all current and future real estate transactions for Olympia Development, the Ilitch entity that would play a big role in a new hockey arena deal.

There are bigger obstacles for Ilitch to clear on a new arena than he had to overcome to build Comerica Park, the home of his Tigers. The path of public and private financing Ilitch took to create the ballpark is likely unavailable to him now, several analysts contend.

Comerica Park opened in April 2000 and cost $300 million to build. Ilitch paid $185 million of the cost of the stadium, owned by the Detroit-Wayne County Stadium Authority, and subleased to the team. The rest was paid for by the city of Detroit, Wayne County and corporate investors. The state of Michigan provided infrastructure improvements.

The stadium authority issued $85 million in 30-year tourist tax bonds in 1997 for the baseball stadium and, with interest, will pay about $176 million by 2027, according to the stadium authority. The bonds are paid twice yearly with revenue from a 2 percent rental-car tax and 1 percent hotel tax in Wayne County. The tax needed Wayne County voter approval.

In this era of painful budget cutting, getting voter approval for another venue is a tough sell, said Bernie Porn, president of EPIC-MRA, an opinion research firm in Lansing that does polling on statewide issues.

"The Tigers could win the World Series, the Red Wings could win the Stanley Cup, and I still don't see how he (Ilitch) gets voter approval for an arena," Porn said.

"Not that I have done any polling about the issue, but in this climate, I think it would be seen as a billionaire is asking for a tax break," he said. "But if you are asking me if he gets it done, I think that answer is yes."

What Ilitch has is rock-solid support in Michigan's corporate community and plenty of his own resources. Mike Ilitch and his wife, Marian, owner of Detroit's second-largest gaming hall, MotorCity Casino, have a combined fortune of $2 billion, according to Forbes magazine. That includes their Little Caesar's pizza franchise empire headquartered in downtown Detroit.

He also could get major help from other Michigan businesses. In September, the Red Wings announced the organization signed a "presenting" sponsor agreement with Amway, the private Ada-based company owned by the DeVos and Van Andel families. Terms of the multiyear deal were not disclosed, but the deal includes Amway's logo being embedded in the ice and signage elsewhere at Joe Louis Arena, and community programs to help young people in Grand Rapids and Detroit.

What the Ilitch, DeVos and Van Andel families share are deep pockets and a love of professional sports.

Amway co-founder and billionaire Richard DeVos owns the National Basketball Association's Orlando Magic, and the team backed $100 million worth of bonds issued by the city of Orlando to build the $480 million Amway Center, which opened last year.

DeVos also supplied $50 million to help build it and $1 million in rent each year and $40 million to put the Amway name on the building.

"The resources are there for the arena to get done," Watkins said. "I'm looking forward to see what the formula will be."

Detroit Red Wings Generates Millions for Ilitch; Franchise can always be subsidized by other Ilitch Holdings enterprises

Wings can flex financial muscle

Team's below salary cap, can bulk up roster

10.23.2011

By Bill Shea

...Estimates for the 2009-10 season by Forbes show Detroit seventh in the 30-team NHL with $119 million in revenue and sixth in operating income at $15.3 million.

The team doesn't comment on its financials.

The salaries are offset by a deeply loyal fan base that keeps the Red Wings near the top of the NHL's attendance rankings every year.

Detroit has played two home games out of a slate of 41 this season, and both have been sold out at 20,066 each. That puts the Red Wings third in the 30-team NHL in per-game attendance average. It finished last season fourth in the league at 19,680 per game.

A single fan is worth $101.48 per game to the Red Wings, according to Chicago-based sports research firm Team Marketing Report's Fan Cost Index published last year. The National Hockey League's FCI average is $101.66.

The calculation is derived by a simple formula: A fan at Joe Louis buys a ticket at $51.73 (average price), a $6 beer, a $3.50 soft drink, a $3.25 hot dog, $20 for parking, a $7 program and a $10 hat.

A full season of sellouts at Joe Louis, based on the Fan Cost Index, would generate $83.4 million over the 41 home games. Part of that is handed over to the city in a form of a 10 percent ticket tax, 10 percent surcharge on concessions and 7 percent on suite sales.

The team once had 396 consecutive sellouts from 1996 through the start of the 2007-08 season -- which coincides with the economic collapse locally and nationally.

Detroit also picks up supplemental revenue from pricier tickets, suite rentals and advertising during the playoffs. And the deeper into the playoffs the Red Wings get, the more money the team collects.

The Red Wings also have made moves on the corporate sponsorship front. In September, the team inked a deal with Ada-based Amway Corp., the network-based direct-marketing giant, to become the team's first-ever presenting team sponsor. Financial terms were not disclosed, but that contract is thought to be a two-year, seven-figure deal.

The Amway logo now appears on all Wings-branded signage at Joe Louis, on tickets and elsewhere.

Detroit also extended a deal with Chrysler Group LLC in another relationship that it declined to discuss the financials.

Another line of revenue comes from broadcast rights: The Red Wings, Tigers and Detroit Pistons have separate 10-year broadcast deals, signed in 2008, with Fox Sports Detroit and collectively are worth about $1 billion.

And if there isn't enough revenue from the team and its various deals, owners Mike and Marin Ilitch can dip into their other businesses to subsidize it.

The family fortune comes from its $2.2 billion in annual sales from its Little Caesars pizza chain or the $446 million from Marian Ilitch's MotorCity Casino.

The Ilitches, who are planning to build a new downtown arena for the Wings in coming years, bought the then-moribund team for $8 million from Bruce Norris in 1982. Mike Ilitch also owns the Tigers.

His stewardship of the Wings has led to him be recognized as one of the top owners in pro sports by Sports Illustrated, ESPN and Haddonfield, N.J.-based Turnkey Sports & Entertainment Inc., which measures brand effectiveness and values of pro sports teams.

The Red Wings are the top team in The Hockey News' weekly power rankings.

"Another year, another spotless start for the NHL's model franchise," the magazine said. (Complete Story)

Detroit #1 on Forbes' List of America's Most Dangerous Cities!

The Benefits of Casino Gaming?

Click to see Dangerous Cities List

For 15 years Detroiters like Michael Malik and Marian Ilitch have told people there that opening up gambling halls would bring the kind of positive economic change that Detroit needs to turn itself around.  The same thing they tell people in Port Huron or Flint (MI), or Elmont (NY), or Barstow (CA). 

Really?  Because Detroit’s three gambling halls have been open and even expanded during this past decade and yet...

From Forbes this past week:
Detroit is America’s #1 Most Dangerous City!

From Huffington Post in March:
New census data indicates Detroit's population dropped by a startling 25 percent in the last decade, from 951,270 in 2000 to 713,777 last year. That's a 60 percent decline from its 1950 peak population -- 1.85 million -- and the lowest count since the 1910 Census put the then-promising Motor City's population at 285,704.

From forecastchart.com last January:During the 10 years ended in the 1st Quarter of 2011, Detroit Home Prices had the worst performance in the country, with appreciation during the decade of -26%. 

From the U.S. Dept of Labor, Bureau of Labor Statistics:

Who Really Benefits from Casino Gaming?
The Ilitch Family (owners of Detroit’s Motor Casino, Red Wings Hockey and Tigers Baseball teams, and Little Caesars’ pizza), Michael Malik and their other PR agents have used those same economic benefit arguments every time they want something from Detroit’s hard working taxpayers – when they want to condemn property or get the Deed City controlled property for "free" (without consideration);  when they ask taxpayers to fund demolition of buildings they’ve let fall into disrepair;  when they secure ticket tax breaks; or worse yet, want the taxpayers to subsidize their parking, sports and entertainment venues.

In truth, the only Detroiters better off today than they were 10 years ago have the last name “Ilitch.”

Last month, in its annual ranking of the 400 Richest Americans, Forbes reported that during the last year, the Ilitch family’s net worth went from $1.7 Billion to $2.0 Billion!  They are #212 on the list of 400 Richest Americans.   In 2004, Forbes estimated the Ilitch Family’s worth at $750 million.

Beware Detroiters who roll into your town and extol the economics of casino development!  They only people who will be enriched are the Detroiters.  They’ll even prey on their own.

Certificate of Forfeiture Issued Over Michael Malik's Lake Front Property; Casino Syndicator Owes Thousands in Back Property Taxes

On April 1, 2010 the Treasurer of Wayne County, Michigan, issued a Certificate of Forfeiture of Real Property on a residence at 960 Lake Shore Rd., Grosse Pointe Shores, Michigan. This is a mid-century lake front home in one of Detroit’s most fabled neighborhoods owned by casino syndicator Michael J. Malik, Sr.

Typically a Certificate of Forfeiture is issued when a property owner fails to pay his or her property taxes; and, in lieu of payment, the governing authority elects to seize the real property.

(1) 960 Lake Shore Rd., Grosse Pointe Shores, Michigan

In 2001, Michael J. Malik, Sr. (G P Development LLC) purchased the residential property at 960 Lake Shore Rd. from the Louis A. Fisher, Jr. Trust with a $4,250,000 mortgage held by Comerica Bank.  It had been the primary residence of Louis A. Fisher and his wife Virginia Nesbitt Fisher until their deaths respectively in 2000 and 1978. Louis was the son of William A. Fisher who along with his six brothers founded Fisher Body Corporation in 1908.  Fisher Body would later become a division of General Motors Company.

The property located at 960 Lake Shore Rd. and fronting Lake St. Clair is located in one of greater Detroit’s most exclusive neighborhoods.  Living two doors south from the Malik property are Mr. and Mrs. Matty Moroun (956 Lake Shore Rd.) owners of Detroit International Bridge Co. (Ambassador Bridge).  Approximately six doors north is the vast estate of William Clay Ford, Jr. (1000 Lake Shore Rd.) once the home of Edsel and Eleanor Ford. 

It’s not clear who, if anyone, currently inhabits the residence at 960 Lake Shore Rd.; however, between 2000 and 2008, Malik and his wife/ex- wife Michele M. Malik, owned three residential properties on Lake Shore Rd.in Grosse Pointe Shores:   

• 583 Lake Shore Rd., a 6,052 square foot home with seven bathrooms, built in 1961 and purchased in May 2003 for $2,000,000. Township records indicate the property was seized by the Sheriff who granted the deed to La Salle Bank Midwest N.A. in November 2008.  Township Property Records
• 591 Lake Shore Rd., an 8,439 square foot home with five bathrooms, built in 1961 and purchased February 2000 for $2,100,000. Township records indicate this property is still owned by Michael Malik and his ex-wife Michelle.  The tax bill is sent to Malik’s office at 2211 Woodward Ave., Detroit.  Township Property Records
• 960 Lake Shore Rd., a 5,511 square foot home with five bathrooms built in 1955 and purchased in 2001 for $4,250,000 – the property for which the Certificate of Forfeiture was issued.  Township Property Records

Analysts question Ilitch finances, Tigers spending

7.20.09

Tigers' ticket sales fall, Ilitch still spending
Are team finances now at full count?

By Bill Shea: (313) 446-1626, bshea@crain.com

The division-leading Detroit Tigers have a large-market payroll with midsize market attendance that's off 22 percent from last year, something the team said it was prepared for but has baseball insiders speculating about the team's long-term financial health.

And to the delight of fans, if not economists, the team's owner is willing to spend even more to return to the World Series — even if it's a money-losing endeavor.

Attendance through last week's All-Star break was averaging 30,875 per game through 40 games at 41,255-seat Comerica Park compared to last season's 39,761 through the same number of home games.

At an average ticket price of $25.15, that roughly translates into $8.9 million less in ticket revenue so far this season.

The fan drop-off is attributed to both the team's last-place finish in 2008 and the subsequent national economic plunge that's been especially harsh in metro Detroit — vaporizing fans' disposable income and making them hesitant to buy tickets for a team three years removed from the Fall Classic.

Season ticket sales dropped to 15,000 this season from 27,000 a year ago.

“The attendance decline is out of step with the rest of the league. Attendance is down about 5 percent leaguewide, so the Tigers' 20 percent decline is not good,” said J.C. Bradbury, an economist and associate professor at Kennesaw State University near Atlanta. He's the author of The Baseball Economist and operates the baseball site www.Sabernomics.com ...

Economic news Web site Forbes.com, which tracks pro sports finances, reported that the Tigers had minus $26.3 million in operating income last season on revenue of $186 million. Gate receipts were $75 million.

“With his payroll and attendance and loss of corporate sponsorships, I think he's losing money,” said Andrew Zimbalist, professor of economics at Smith College in Massachusetts and author of several books on the business of baseball...

(Original Post)

Ilitch not renewing existing lease on Joe Louis Arena

6.26.09

Ilitches not renewing old Joe Louis lease, negotiating for new deal

By Bill Shea

The statement today that the owners of the Detroit Red Wings aren’t renewing their expiring Joe Louis Arena master lease leaves it unclear if they will pursue a new hockey arena or renovate their 30-year-old city-owned home.

The owners say they now plan to negotiate a new lease for Joe Louis, which could be a long-term commitment and what insiders say would be a $150 million renovation job, or it could be a shorter deal that buys them time to arrange financing for a new venue that could cost $300 million to $400 million.

Olympia Entertainment, which manages Joe Louis and Cobo Arena under a single lease and is owned by team owners Mike and Marian Ilitch, was required to notify the city by Tuesday of their intentions with the contract, which expires on July 1, 2010. Otherwise, it automatically renewed for 20 years.

The statement from Olympia today says the lease isn’t being renewed to allow the city to forge ahead with an expansion of Cobo Center, which is managed by the city but includes the Ilitch-run Cobo Arena.

The city needed Ilitch-owned Olympia Entertainment to renegotiate the master lease because it includes language that gives Olympia say over any project that would significantly impact Cobo Arena.

Not renewing basically turns Cobo Arena back over to the city, paving the way for the long-debated control and expansion of Cobo Center — something needed to prevent the loss of the annual North American International Auto Show.

Olympia has been negotiating for years on the lease with the Detroit Economic Development Corp., and the statement Friday said the Ilitches will continue to pursue a new lease for just Joe Louis.

“The existing lease was crafted more than three decades ago by individuals no longer associated with either Olympia Entertainment or the city,” Ilitch Holdings Inc. President and CEO Chris Ilitch is quoted as saying in the statement. “It does not fully contemplate one: the evolution of the sports and entertainment industry; two: the current economic environment in which both the city and Olympia Entertainment are operating and; three: the infrastructure replacement and repair needs of a 30-year-old building in order to meet the competitive industry standards of today.”

The statement notes that Joe Louis Arena is the fourth-oldest venue in the National Hockey League. Teams seek new arenas because modern facilities provide deeper revenue streams than older facilities.

Ilitch spokeswoman Karen Cullen said no comment would be made on the specifics of the new lease talks.

The Ilitches bought the Red Wings from former owner Bruce Norris in 1982 for $8 million, and today it’s valued by Forbes.com at $303 million.

Wayne County Executive Robert Ficano has said he’s been approached by the Ilitches about financing a new arena, but has declined to say more.

Both Comerica Park, where the Ilitch-owned Detroit Tigers play, and Ford Field, home of the National Football League’s Detroit Lions, are owned by the Detroit-Wayne County Stadium Authority, a quasi-public board of city and county appointees, and are leased to the county and then subleased to the teams.

The authority, along with the DEGC, also partially financed both ballparks.

Any use of tax dollars to subsidize stadium construction — either in the form of a direct levy or by extension of current taxes — generates fierce criticism that it’s nothing more than welfare for rich owners and players.

Speculation is that a new hockey arena would be built on Ilitch-owned land in the Foxtown area or between Grand River and Cass south of I75.

Not renewing the master lease means the Ilitches give up a cap on property taxes at Joe Louis, which limits them to $252,000 annually. Without the cap, the taxes would be about $1 million. While the city owns Joe Louis, the lease called for the Ilitches to pay the property taxes — something that could continue under a new lease, or be changed.

The lease, first negotiated under Mayor Coleman Young after the Detroit Lions and Detroit Pistons left for the suburbs, has drawn criticism, including from the Detroit City Council, that it tilts too far in favor of the Red Wings.

Detroit gets a cut of tickets, concessions, corporate and suite sales at both venues, which would have been lost if the lease was renewed. New surcharges could be negotiated under a new lease, and at a new arena.

If the Ilitches, who have a year to work out a new lease, decide to pursue a new arena, financing options include particular-use taxes, use fees built into ticket prices, new lottery games, or the city and/or county issuing revenue bonds. Private money from the owners and from corporate investment, especially from naming rights, also will finance any new stadium.

Building a publicly owned stadium and leasing it to the team, which was done for the Tigers and Lions, is also an option — but one that carries political risks because it would require tax dollars in economically tough times.

Debt financing by the team is also iffy because banks are hesitant to loan money at the favorable rates from even a year ago, something that’s hampered stadium projects elsewhere in the country.

A new short-term lease at Joe Louis buys time for the markets to improve.

Highlights of exisiting lease Ilitch holds on Joe Louis & Cobo Arenas

6.26.09

TERM OF EXISTING JOE LOUIS LEASE

The Ilitch family’s lease for its Red Wings to play at Joe Louis Arena expires in a year, and will be replaced by a new deal. The current lease includes:

• The city provides free police and landscaping services, including snow removal, for both the Joe Louis Arena and Cobo Arena, and up to $500,000 annually for capital improvements for the hockey venue.

• The Ilitches pay property taxes on city-owned Joe Louis, but they are capped at $252,000 annually. Without the cap, the tax would be about $1 million.

• The Ilitches pay $25,000 monthly rent for Joe Louis and $12,500 for Cobo.

• Detroit collects a 10 percent ticket tax for Joe Louis events and a 7.5 percent ticket tax for Cobo events.

• The city collects a surcharge of 10 percent on concessions and 7 percent on suite sales.

• If the lease is renewed, the city immediately loses the ticket taxes and in five years loses the surcharge on concessions and suites.

• A new arena would mean the city could charge for police and snow services and collect full property taxes on the venue. The city also could lose its ticket, concession and suites surcharges. All this depends, of course, on a new lease or stadium deal, its financing and who owns the new venue.

10,000 fans a game reject Detroit Tigers after Ilitch hiked ticket prices

6.21.09

10,000 fewer Detroit Tigers fans fill seats each game
'08 heartbreak, weak economy are blamed

BY JOHN GALLAGHER
FREE PRESS BUSINESS WRITER

Boosted by their World Series appearance in 2006, the Tigers drew more than 3 million fans to Comerica Park for the first time in 2007, and topped 3.2 million fans in 2008, when expectations ran high.

But the Tigers, with a disappointing finish last year, combined with a collapsing economy, saw a plunge in ticket sales this year. The Tigers are averaging about 28,000 fans per game this year, down from 38,000 per game at this time last season...

...The Tigers have troubles beyond about 10,000 more empty seats per game this year than last. Forbes magazine, in its annual ranking of sports teams' values, put the Tigers in 21st out of 30 Major League Baseball teams, with a total value of $371 million. That estimate marked a 9% decline in value from the year before.

Moreover, the Tigers have one of the most expensive payrolls in baseball, with first baseman Miguel Cabrera signing a $153-million, 8-year.contract last year, breaking the $75-million, 5-year contract signed by outfielder Magglio Ordóñez in 2005. Combined with lower ticket sales, the team is losing money this year, Forbes estimated.

Meeting that payroll is one reason owner Mike Ilitch raised ticket prices this year.

"With the auto companies imploding and discretionary income plummeting for many fans, Ilitch's strategy looks like it has backfired," Forbes suggested earlier this year

Being privately owned by the Ilitch family empire, the Tigers do not release hard financial data. But Gilette said that absent a second-half collapse by the team (which, in fact, has failed to generate much offense lately despite its first-place standing), the Tigers should muddle through this season. (Complete Story)

Detroit casino to benefit from Obama stimulus package

According to blogger Brian Darling at HumanEvents.com; the Obama stimulus package includes:

"$1.5 million to improve the parking garages and roads surrounding the Greektown Casino development in Detroit."

Detroit's Greektown Casino filed for Chapter 11 bankruptcy protection back in May. Greektown Casino, one of three commercially operated casinos in Detroit, is owned primarily by the Sault Ste. Marie Tribe of Chippewa Indians.

Tom Celani, a former founding partner in Detroit's MotorCity Casino along with Marian Ilitch and Michael J. Malik, Sr., tried to buy controlling interest in Greektown Casino back in January, according to a story published in the Detroit News, but that transaction was never consumated.

But now, according to BackRoomNews.com:

"Tom Celani, a Bloomfield Hills businessman and investor, is trying to buy Greektown Casino in downtown Detroit.

Celani, who was an initial investor in Motor City Casino, has partnered with a Connecticut-based hedge fund called Plainfield to bid for Greektown, which is being marketed to buyers through bankruptcy proceedings.

Celani says he expects he is among up to four bidders interested in the casino, which generates $300 million a year in annual revenue. Celani would not disclose the amount of his bid.

'I understand the property very well … I’ve been in the casino business for 20 years. Gaming is what we enjoy,' Celani said. 'I’d love to do it in my hometown.' "

Ilitch uses taxpayer subsidies to level more Foxtown buildings

3.19.09

Spaces for Final Four
Buildings razed to open room for new parking lots

Louis Aguilar / The Detroit News

DETROIT -- To create more parking for the throngs anticipated for next month's NCCA Final Four basketball championship, Ilitch Holdings Inc. is using state Super Bowl XL funds to quickly demolish five empty downtown buildings.

In less than two weeks, four buildings have been razed, including the former Chin Tiki, a Polynesian-themed restaurant featured in the Eminem film "8 Mile." The other demolished structures are a former apartment complex on West Grand River; an office building on West Columbia; and the former Egyptian building on Cass.

The last one to go is a parking garage at 145 W. Elizabeth, bought by an Ilitch executive in 2007 through a private company, which listed the Ilitches' Fox Theatre headquarters as its address. That was the period in which the Ilitch family quietly increased control of a rundown patch of downtown long considered a potential site for a new hockey arena for the Ilitch-owned Detroit Red Wings.

Mike Ilitch, co-founder of the Little Caesars Pizza chain that started the family's billion-dollar sports, real estate and business empire, has hinted he prefers building a new hockey arena near the Fox.

No decision has been made about that.

The flurry of demolition is all about "added safety and security," said Ilitch spokeswoman Karen Cullen.

"The structures in question were not suitable for long-term redevelopment," Cullen said. "The ability to move forward and remove non-viable buildings from the area ... greatly enhances the appearance for surrounding property owners and their venues."

In December, the city's Downtown Development Authority approved $2.5 million for the demolitions. The money came from state funding originally intended to level empty buildings in time for Super Bowl XL, three years ago.

The properties will become paved parking lots to accommodate the more than 100,000 people who will converge downtown during the first week of April for the NCAA Final Four.

"Yes, that's still the goal," said Fred Beal, president of J.C. Beal Construction Inc, who lobbied on behalf of the Ilitches to obtain the state money.

You can reach Louis Aguilar at (313) 222-2760 or laguilar@detnews.com

TVT Note: A comprehensive map of properties believed to be owned or controlled by the Ilitch family in Foxtown is available here.

Joe Louis Arena by any other name is still Joe Louis Arena

1.25.09

Slow economy stalls naming deal for new Metro terminal

By Bill Shea

...The Detroit Red Wings and Detroit Pistons, don't have corporate names on their venues.

The Ilitch Holdings Inc.-owned Red Wings play at city-owned Joe Louis Arena and have the right to sell the venue name but won't, said Karen Cullen, Ilitch's vice president of corporate communications.

That's because the team's lease predates the trend of naming-rights deals, which began in earnest in the 1990s, and the realization fans are very unlikely to call the facility anything but the Joe Louis Arena, making a name deal unattractive to companies.

The Ilitches continue to consider renovating Joe Louis or building a new stadium, and any new venue would likely include a name deal — just as with the Ilitch-owned Detroit Tigers and Comerica Park. The company must tell the city by June 30 if it plans to renew the Joe Louis lease, but may be seeking an extension... (Complete Story)

$2.5M taxpayer subsidy so Ilitch can demo its decaying structures in west Foxtown

First, recall the dashboard graphic published in the Detroit News on 9.23.08 to demonstrate the uparralled decline of Michigan's economy and that the week before on 9.17.08 Forbes ranked Michael Ilitch #301 on its annual list of the "400 Richest Americans."

And now, in an article published 12.11.08 in Crain's Detroit Business it has been disclosed that various Ilitch Family-owned entities (Olympia Development of MI LLC, Olympia Entertainment LLC, Elizabeth Street Properties LLC, etc.) will receive $2.5 million from taxpayers to demolish six strucutres that Ilitch boarded up and then left decaying during the last decade. Ilitch purchased these devalued properties with intention or in some cases was nearly gifted them by the Wayne County Treasurer; and now he wants another handout?

Capping the demolition list is the historic Fine Arts/Adams Theatre Building located on W. Adams Ave. in Grand Circus Park.

In the 12.11.08 Crain's story, Fred Beal of J.C. Beal Construction Inc. reports the facade of the Fine Arts Building will remain intact echoing a previous promise by Ilitch spokeswoman Karen Cullen. (Fine Arts is coming down; Ilitch Lifts City Hopes; Ilitches Downtown Power Play)

Included among the other buildings that would be demolished are West Grand River Lofts at 2030 W. Grand River Ave., and the Ancient Egyptian Arabic Order of Noble Mythic Shrine at 2203 Cass Ave.

This is yet another of the Ilitch Family's taxpayer subsidized demolition plans. It will level all but two major structures from property controlled by Ilitch-owned entities in the west end of Detroit's Foxtown -- an area in downtown Detroit that's home to the headquarters of Ilitch Holdings, Inc., and where various Ilitch enterprises are dominate property owners. If this latest round of demo goes forward as planned, left standing on Ilitch owned property in the near vicinity would be just two pre-existing structures: (1) the former Chin Tiki Restaurant building featured prominently in Eminem's 2002 feature film "8 Mile;" and (2) the historic Moose Lodge Building which Ilitch acquired from promoter Blair McGowan.

At a time when working men and women in Michigan are facing some of the most desperate economic times in their adult lives, one of the richest men in America is asking for several million dollars in taxpayers handouts so he can demolish structures he let decay throughout the last decade. Is that just how rich guys in Michigan do it; spend their money flying around on corporate jets and other luxuries while they watch their business enterprises decay and then ask taxpayers to bail them out?

View comprehensive map @ live.com

Ilitch to get another $2.5 million from taxpayers to again demolish buildings

12.11.08

Detroit authority to pay for demolition of Ilitch company buildings

by Nancy Kaffer

Detroit’s Downtown Development Authority approved $2.5 million in state-funded grants to demolish six dilapidated downtown buildings owned by the Ilitch family’s Olympia Development.

The demolition funds are part of a pre-Super Bowl state allocation targeting Detroit’s most dilapidated structures.

Capping the demolition list is the historic Fine Arts/Adams Theatre Building in Grand Circus Park.

Also, buildings at 479-481 West Columbia, 2203-2211 Cass Ave., 2030 West Grand River Ave. and 145 Elizabeth St. would be completely demolished and replaced with hard-surface parking lots, said Fred Beal, president of Ann Arbor- and Detroit-based J.C. Beal Construction Inc.

The Fine Arts/Adams Theatre Building’s façade will remain as part of an agreement with the city’s Historic District Commission. Olympia will pick up the tab for the estimated $500,000 façade stabilization, Beal said.

The five smaller projects should be completed by the time the National Collegiate Athletic Association’s Final Four basketball tournament comes to Detroit in April, he said.

Two board members, attorney Jan Appel and downtown businessman Ted Gatzaros, voted against the project.

The Ilitch family’s ownership of the buildings gave some board members pause, leading to questions about the use of public money to demolish privately owned buildings.

Gatzaros asked whether Olympia-owned properties were those most in need of DDA-funded demolition.

“We need to prioritize where we apply money,” he said.

City officials urged action, pointing to the three years that have passed since the funds were initially made available.

“We have buildings falling down all around us and the owners won’t let us take them down,” said Douglas Diggs, director of Detroit’s Planning and Development Department. “I don’t think there’s any way to say these buildings shouldn’t come down. This impacts all of downtown.”

Original Article: http://www.crainsdetroit.com/article/20081211/FREE/812119975

See comprehensive maps of more than 160 Iitch-owned properties in Downtown Detroit

Gov. Granholm grants Ilitch $750k tax break for Detroit Life Building

10.17.07

Ilitches and Curis Enterprises get tax credit from Granholm for projects

DETROIT -- Michigan Gov. Jennifer Granholm announced this morning that Ilitch Holdings will receive a $750,000 tax credit to rehabilitate the 10-story Detroit Life Building in downtown Detroit.

The 40,000-square-foot building, which has been vacant for 30 years, is located at Park and Columbus, just southeast of the Fox Theatre.

The Ilitches, who own the Detroit Tigers, Detroit Red Wings, Fox Theatre and Little Caesar Enterprises, plan to spend a total of $7.5 million restoring the structure. The exterior and first floor lobby will bring it back to its original condition.

The first floor will be used for retail space, and the second through 10th floors will be converted to office space.

A tax abatement for the project is being considered by the City of Detroit.

In the Detroit enclave city of Highland Park, Granholm also announced a state tax credit of $527,000 will be used by developer Michael Curis of Curis Enterprises to develop the new Woodward Place on Woodward Avenue, formerly occupied by a Sears Roebuck store razed in 2002.

The project entails cleanup of the 3.97-acre site and construction of a 40,000-square-foot shopping center anchored by Aldi Foods. Tenants may include a bank, pizza shop, retail stores, restaurant and police mini-station. The development will be enhanced by extensive landscaping, wrought iron fence and flag plaza.

The project is expected to involve $7.45 million in investment and create 120 jobs.

Find this article at:
http://www.detnews.com/apps/pbcs.dll/article?AID=/20071017/UPDATE/710170438/1361

Detroit taxpayers paid Ilitch $2.5 million as "caretaker" of abandoned Tiger Stadium

posted at AbsoluteMichigan.com:

"The Detroit News reports that seven years after a century of baseball ended at Tiger Stadium, money for its upkeep and hopes it can ever be saved are running dry. Since the Tigers moved to Comerica Park in 2000, the city has paid the team's owner, Mike Ilitch, an estimated $2.5 million for maintenance and security at the old park.

Wayne County Treasurer reports Ilitch delinquent on 2006 Detroit Life Building taxes

According to the Wayne County Treasurer's Web site at the time of this post the 2006 property taxes are delinquent for the Foxtown parcel at 2210 Park Ave., Detroit, MI 48201 (parcel ID 02000447.

That's the address of the Detroit Life Building owned by Olympia Entertainment, Inc. (Ilitch Family) and said to be the future home of hundreds of Ilitch Holdings, Inc. employees.

The Detroit Life Building is located on Park Ave., directly behind the Ilitch-owned Fox Theater and Office Building.

Ilitch's Sports Arena Hat Trick cheats other property owner

as published 7.22.07 at Amy Ridenour's National Center Blog, a project of the National Center For Public Policy Research:

The Detroit government low balled a local landowner for the sale of her property that it deceitfully said would be developed into a parking lot. As it turns out, the land was wanted for a hockey arena - a far more valuable project than a parking lot. The government also acquired the land on behalf of a private businessman, and it then tried to transfer the land to that businessman's firm to build the arena.

Sports Arena Hat Trick Penalizes Property Owner

Detroit property owner Freda Alibri received an offer she couldn't refuse. The Detroit/Wayne County Stadium Authority, a public entity, approached her in 1997 wanting to purchase land she owned. The stadium authority wanted the land for two new sports stadiums and parking lots.Alibri gladly sold the government the property, but later discovered that some of the parking lot land, which she sold to them at a parking lot price, was instead intended to be the site of a third sports venue that made the land worth a whole lot more. Furthermore, the third venue wasn't even a public project presided over by the Stadium Authority, but rather a private venture. When Alibri protested, she was told to be happy with what she got, but she considers the transaction to be an abuse of the government's power of eminent domain.

The taxpayer-funded Stadium Authority was reportedly acquiring land so new stadiums could be built for both the Detroit Tigers baseball team and the Detroit Lions football team. In addition to property Alibri owned directly on the site of the planned stadiums, she also owned a one-acre parking lot located several blocks away. While the Stadium Authority bought the property she owned directly where the stadiums were to be built for more than $6 million, they also said they needed her parking lot, ostensibly for stadium parking. Alibri sold the lot to the Stadium Authority for $268,498.

It was later discovered that the money the Stadium Authority used to buy Alibri's parking lot was "borrowed" from Mike Ilitch, the owner of the Detroit Tigers and the Detroit Red Wings hockey team. Ilitch owned several properties close to Alibri's parking lot. He was considering building a new hockey arena on the site of the property the Stadium Authority bought from Alibri with his "loan." In 1998, the Stadium Authority tried to repay the loan by transferring Alibri's former property to an Ilitch firm. Alibri cried foul, arguing that she was deceived by the Stadium Authority so Ilitch could cheaply acquire land for his new hockey arena. She estimated her parcel would sell for almost $2 million as land for a prospective arena as opposed to $268,498 for stadium parking.

Fred Steinhardt, a condemnation lawyer with clients in the same area, told the Detroit News, "Sweetheart doesn't adequately describe what's going on. They're condemning parking lots so Mr. Ilitch can have parking lots? What's that all about?" If Ilitch's private firm could acquire the land at 1997 prices through the public Stadium Authority, then he would avoid having to buy the property for his hockey arena from individual owners at higher prices in the future.

Alibri went to court and got an injunction to stop the deal. She then sued to have her property returned. After a favorable trial court ruling was overturned on appeal, the case was brought before the Michigan Supreme Court. In July 2004, the Court sided with Alibri and returned her land.

Sources: Detroit News (August 14, 2000), Metro Times (April 23, 1997), Alibri v. Detroit/WayneCounty Stadium Authority (Michigan Supreme Court, Lansing, Michigan)**

Read this story and 99 other all-new outrageous stories of government regulatory abuse in the new fifth edition of the National Center for Public Policy Research's book, "Shattered Dreams: One Hundred Stories of Government Abuse."

Download your free PDF copy today here.**

You may also want to review the following posts or click on the "labels" below for related posts:

• Aerial photo of possible Foxtown site for a new Detroit hockey arena posted at Flickr
• UPDATED: Ilitch has an insatiable appetite for land in downtown Detroit
• Supreme Court ruled against Ilitch eminent domain scheme
• State Subsidizing Plans for Detroit Hockey Arena
• Blogger tells how Detroit Billionaires are getting rich off taxpayer subsidies and the public dole
• Red Wings Owner demolishing, clearing downtown Detroit
• Map suggests Red Wings owner may be making way for a new hockey arena
• Behind the Scenes: Ilitch and City in Hockey Arena showdown

Taxpayers picked up $400k bill for Tigers new seats; next day Ilitch paid $525 million for casino

from the March 19-25, 2005 archives of BallPark Digest:

Taxpayers foot bill for Tiger seats

Posted March 20, 2005
Financially strapped Wayne County is picking up $400,000 of the total $1.2 million needed to add 900 seats to the right-field bleachers at Comerica Field, the home of the Detroit Tigers. The team will pick up the rest of the cost; the project is expected to be completed by Opening Day. The deal irritates some fans and taxpayers, especially since it came one day after Marian Ilitch, the wife of Tigers owner Mike Ilitch, bid $525 million to become the sole owner of MotorCity Casino.

A Detroit News reader survey at the time indicated:

The Wayne County Commission has decided to pay $400,000 toward the cost of adding 950 seats to Comerica Park. Do you support this expenditure?

Yes 14.55%
No 85.45%

Bay Mills Indians have received $35 million in federal grants since 2000

According to resources available at FedSpending.org, the Bay Mills Indian Community and its various affiliated entities have received more than $35 million in federal grants since FY 2000.

This does not include grants to Bay Mills affiliates that don’t carry the “Bay Mills” name such as the “Great Lakes Composites Institute” which received a $906,000 federal grant to construct an industrial facility for R&D and manufacturing in Chippewa County.

FedSpending.Org

a project of OMB Watch

Bay Mills Federal Grants FY 2000-2006
Fiscal Year	# Grant Recipients	Total $
2000	05	$3,336,215
2001	06	$5,154,818
2002	08	$6,758,603
2003	09	$5,006,805
2004	07	$5,940,064
2005	08	$9,069,913
2006*	04	$49,141
Total	47	$35,315,559
* First Quarter only ** Does not include Composites Institute funds; or other enterprise endeavors

These Bay Mills affiliates received grants:

• Bay Mills Community College
• Bay Mills Conservation Enforcement
• Bay Mills Executive Council
• Bay Mills Housing Authority
• Bay Mills Indian Community
• Bay Mills Indian Community Council
• Bay Mills Indian Community HA
• Bay Mills Indian Location: 02
• Bay Mills Indian Location: 03
• Bay Mills Law Enforcement
• Bay Mills Ojibwe Charter School
• Bay Mills Township Vol. Fire Department
• Michigan Bay Mills Indian Community
• Michigan Bay Mills Indians

http://www.fedspending.org/faads/faads.php?recipient_name=bay+mills&sortby=r&detail=0&datype=T&reptype=r&database=faads&fiscal_year=&submit=GO