A long-awaited plan to expand Detroit’s Cobo Center may be closer to reality after a series of recent meetings between regional leaders and Michigan Gov. Jennifer Granholm.
Negotiations are now focused on the makeup of an authority that would operate the center, according to local reports.
Cobo’s expansion is considered key to the future of the city, as it hosts the North American International Auto Show, the largest economic event in southeast Michigan. Porsche Cars North America Inc. dropped out last year and Suzuki Motor Corp. withdrew earlier this year, citing insufficient space.
The chief expansion proposal under consideration estimates the project’s cost at $900 million, of which roughly $600 million would be borrowed.
In the last few weeks, Detroit Mayor Kwame Kilpatrick, Wayne County Executive Wayne Ficano, and Oakland County Executive L. Brooks Patterson have all met separately with Granholm. A Kilpatrick spokesman called the mayor’s meeting “very productive,” but no details were announced.
Patterson, who has been critical of the current proposal, told local media that he believed a compromise was still far off. He has predicted Oakland County would end up paying more than its share of increased taxes to pay for the project.
Under the current plan, proposed by Ficano, the Cobo Center would be expanded by 120,000 square feet. The state would create a new authority that would purchase the facility from Detroit for $20 million and would have the ability to issue bonds. The project would in part be financed through liquor and hotel taxes. The state would also create a sales-tax-free zone in an effort to attract more conventions.
Detroit reportedly wants to maintain control over the authority’s board, while suburban leaders want to split control evenly, according to the Detroit News.
Meanwhile, several bills supporting the plan have been introduced in the Michigan Legislature. They include one that would create an authority to run the center, one that would extend the hotel room and liquor sales tax to 2022 from 2015, one that would create a sales-tax-free zone at Cobo, and one setting aside $50 million in state funding for the plan.
Officials from the North American Auto Show, who lobbied for the legislative measures, said last week they were encouraged by the round of meetings with Granholm.
The auto show is estimated to bring in $500 million in annual revenues to the area, far exceeding in economic impact any other event in the state.
