CHICAGO - The fate of a $300 million bond-financed plan to expand Detroit's convention center - one of the city's chief economic assets - appears headed for court.
A week after the City Council rejected legislation crafted by Michigan lawmakers to expand and renovate Cobo Hall, Mayor Ken Cockrel Jr. this week vetoed the council's move. In response, council President Monica Conyers said she would challenge his veto in court.
Today is the deadline for the council to override Cockrel's veto, but the council likely lacks the votes to do so.
Home of the North American International Auto Show, Cobo is one of the city's main assets, bringing in an estimated $600 million a year. The auto show has agreed to stay at the center through 2010, though a growing number of automakers have started to pull out of the show, citing space constraints.
For Conyers and the two other council members who oppose the plan, the legislation does not give Detroit enough money or power. Supporters say the deal would save the city money while allowing it to continue to reap economic benefits.
"Cobo costs us about $15 million a year out of our general fund, and we need to invest about $200 million in maintenance and repair right now," Cockrel said in a press conference Wednesday afternoon announcing his veto. "That's pretty hard to justify, when the city faces a deficit of up to $250 million."
In her own press conference held an hour after Cockrel's, Conyers warned she would sue. "If he wants a court battle, then I guess he has a court battle," she said.
While the city charter allows the mayor to veto the council's decisions, some say in this case Cockrel's veto is illegal as the state's legislation seems to give the council sole power to reject the plan.
The legislation would create a new bond-issuing authority to oversee Cobo. The expansion would be financed through $288 million of revenue bonds backed by hotel and liquor taxes. The five-member authority would be made up of representatives from Detroit and Wayne, Oakland, and Macomb counties, with one member appointed by the governor.
Under the deal, the authority would pay Detroit $20 million for the center and take over debt service on bonds issued in 1989 to finance a previous expansion.
