Rewarding Developers again: Grand Rapids gives $29 million of tax credits to new movie theater complex project

Yesterday, the Grand Rapids City Commission decided to give $29 million of public/taxpayer money as a subsidy to the new movie theater project, which will be located right behind the arena.

The $29 million is specifically for brownfield reimbursements, which will include, according to the City Commission packet for November 28: 

• Baseline environmental assessment activities
• Demolition
• Site Preparation
• Infrastructure Improvements
• Brownfield Plan Amendment/Work Plan Preparation and Development
• Prepaid Brownfield Plan Administrative Fee

Jackson Entertainment is the LLC listed for this project, but it is really a Loeks Theater Inc project.

According to the MLive article, “the development is expected to create more than 500 jobs.” However, looking at the packet for the City Commission meeting most of the jobs are part-time and do not pay livable wages (either $11 or $12 an hour).  

The MLive article also lists the projected cost of the 187 unit apartment building.

• Studios: $875 to $1,060 per month
• One bedroom: $1,150 to $1,450 per month
• Two bedrooms: $1,600 to $1,725 per month

This means that most of the jobs that are connected with this new project will not allow those part time employees making $11 – $12 an hour, unable to afford to live in the apartments being built.

A previous MLive article, reported that this project will generate $369 million over a 10 years period.  However, the article never really talks about who will be the primary beneficiaries of this $369 million over a 10 year period. Those who will be the primary beneficiaries are: Loeks Theater Inc, 616 Development and the surrounding businesses – restaurants, bars and retails store owners. I say owners, because they will profit the most, not those who do the actual work at these places.

$29 million for Affordable Housing?

Of course, the most disconcerting aspect of the decision by the City of Grand Rapids  was to give $29 million in tax breaks/subsidies to the developer. Once again, the public had no say in this decision to give away massive amounts of public money to the private sector.

Equally disconcerting is the fact that in recent years the city has approved hundreds of millions of dollars in tax subsidies to developers across the city, while only committing $1 million for Affordable Housing.

If the city just used the $29 million dollars of public money that was given away for this new development project, imagine how many affordable housing units could be created for individuals and families struggling to survive. If we estimated that the construction cost of a home for a family of four would be $150,000 each, that would mean that we could provide 193 families affordable homes equal to the tax credits just offered to the movie theater complex.