Detroit plan will invest $125 million in business districts, reclaim $2.6 billion in retail spending

Detroit plan will invest $125 million in business districts, reclaim $2.6 billion in retail spending
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Some Detroit business districts showing small, but promising signs of recovery, as well as the many with little to no hope of improvement in sight, will soon get a seismic infusion of capital, Mayor Mike Duggan announced today.

If approved by the Detroit City Council, the improvement dollars will come $125 million in bond funds, which the City of Detroit will invest to revitalize neighborhood commercial corridors, according the mayor.  He will submit a proposal to the city council in the next two weeks requesting approval.

“Using these bond funds, we are going to revitalize many of our neighborhood commercial corridors to create vibrant, attractive districts so Detroiters have a place to shop in their own neighborhood.”  -Mayor Mike Duggan

Weary, and in many cases, unsafe pedestrian walkways will be repaired and business districts made more inviting. It’s part of the plan to recapture the estimated $2.6 billion in spending lost to surrounding suburbs by city residents who drive miles away from their homes to purchase everyday goods and services commonly available within walking distance of residential districts in most major cities, including their own.

The lost revenue and associated economic costs are captured in a study soon to be released by the Detroit Economic Development Corporation (DEGC).

Area shops in the Livernois-McNichols area, like Detroit Sip, will be the beneficiaries of an infusion of capital to fix cracked sidewalks, improve landscaping and infrastructure.  The DEGC estimates that the area businesses could capture $215 million in additional retail activity annually, Photo by Michelle & Chris Gerard

“Every day, many Detroiters drive from their homes past underutilized business districts to shop outside of our city,” says Duggan. “Using these bond funds, we are going to revitalize many of our neighborhood commercial corridors to create vibrant, attractive districts so Detroiters have a place to shop in their own neighborhood.”

Approximately $80 million of the bond revenue would fund major infrastructure improvements along 21 of Detroit’s key commercial corridors, such as Livernois-McNichols, West Vernor and East Warren. The other $45 million will complement existing road funds to improve 300 miles of city roads and replace hundreds of thousands of broken sections of sidewalk across the city.

Corridor improvements would include landscaping and reconfiguring traffic lanes to add bike lanes, improved street parking and, in some cases, wider sidewalks to allow for outdoor café seating.

Grand River WorkPlace is one of the shining examples of Detroit’s boot-strap business districts that have made a lot of progress with limited funds. With additional support, it is expected Detroit’s commercial corridors will teem with customers and happy leaders like WorkPlace head Larrisa Carr. Photo by Michelle & Chris Gerard

According to the DEGC report, major improvements will bring millions of dollars back to some of the city’s retail corridors. The corridor at Livernois and McNichols, for example, could capture $215 million in retail activity annually, according to the study.

“People are drawn to attractive places, not just to shop, but to live,” says Planning Director Maurice Cox. “Our goal is to create beautiful retail districts that are uniquely Detroit and offer the kinds of services and amenities that will attract people from surrounding neighborhoods and surrounding cities.”

Corridor improvements will be done in conjunction with ongoing neighborhood planning projects that aim to create framework strategies to boost neighborhood and economic development.

The work will impact 15 areas throughout the city, including:

  • Southwest/West Vernor Corridor
  • Islandview/Greater Villages
  • Grand River/Northwest
  • Livernois & McNichols
  • Rosa Parks/Clairmount
  • Banglatown
  • Russell Woods
  • Jefferson Chalmers
  • Delray
  • Eastern Market
  • Osborn
  • East English Village
  • Corktown
  • Brush Park
  • East Riverfront

Together, these 15 planning areas touch more than 60 individual neighborhoods. Each study will coordinate planning with existing community groups, identify key issues and come up with innovative yet realistic solutions the city can implement. The goal is to have strong community engagement in each neighborhood study that will produce community-driven framework plans for the areas.

Work on the streetscapes projects will begin by early 2018 with professional engineers assessing damage and determining scopes of work for each streetscape. Construction on the first projects will begin in 2018, with the earliest completed by early 2020 and all improvements completed by 2023. Road paving and sidewalk improvements will begin in 2018 and continue annually for five years.

No impact on general fund or existing road work

Repairs to hundreds of thousands of broken sections of sidewalk  and road improvements will help lift business districts and the many small shops that define them. Photo by Michelle & Chris Gerard

Funding for the improvements will come from increased revenues the city is receiving from its share of state gas taxes and vehicle registration fees that have not been included in its current road improvement plan. Under the mayor’s proposal, no city general fund dollars will be used to pay back the bonds and no road maintenance activities or construction projects or will be cut.

The enhancement program is part of city’s larger $317-million plan to improve 300 miles of road and replace 300,000 damaged sidewalk flags over next five years

A seven-bill package approved by the Michigan Legislature in November 2015 raised an estimated $1.2 billion annually for road work. House Bills 4738 & 4736 raised a significant portion of those revenues by increasing the following:

  • Gas tax increased from 19 cents per gallon to 26.3 cents
  • Diesel tax increased from 15 cents per gallon to 26.3 cents
  • Vehicle registration fees increased by 20%

The city’s annual share of state road revenue is being increased gradually over a five-year period, reaching its maximum amount in 2021:

  • 2017 – $65 million
  • 2018 – $77 million
  • 2019 – $82 million
  • 2020 – $88 million
  • 2021 – $95 million

Instead of funding a handful of additional road projects each year, the increase in annual transportation funds will be used to leverage the bonds and allow the city to make an immediate and meaningful impact on numerous city neighborhoods.

In addition to the $125 million in projects funded by the bond funds, the city also plans to spend another $193 million of budgeted city, state and federal dollars, for a total investment of $317 million over the next five years, to improve a total of 300 miles or major roads and residential streets across the city and replace 300,000 broken sidewalk sections. This means 75 percent of the total funding will go toward traditional road and sidewalk improvements, while 25 percent will toward corridor enhancements.

Plan puts Detroiters to work

The neighborhood redevelopment plan will also create a number construction jobs, and DPW will continue its commitment to hire Detroiters in rebuilding the city by following the Executive Order 2016-1 requirement that a minimum of 51 percent of hours worked on publicly funded construction projects are done by Detroiters.

Mayor Duggan’s $125 million investment plan is fueling hopes for a better (and more lucrative) tomorrow for many Detroit businesses. Photo Nat Zorach

In 2016, 57 percent of all sidewalk repairs were done by Detroit residents and 54 percent of all roads were paved by Detroit residents. In 2018 and beyond, DPW will continue to hire at least 51 percent Detroiters to complete construction work.

DPW also expects to continue awarding 100 percent of prime contractors for sidewalks and resurfacing work to Detroit based companies though the five-year project, something they achieved in 2016 and 2017. The 100 percent rate exceeds the 30 percent requirement in Executive Order 2016-1.

“We are very proud of the fact we are providing an opportunity for Detroiters to rebuild Detroit,” says DPW Director Ron Brundidge. “This added work will mean more jobs for city residents.”

Project selection process

As neighborhood streets are repaved, all identified damaged sidewalks will be replaced. Additional inspection and complaint-based locations will be prioritized based upon the condition of the sidewalk, proximity to schools and parks, areas adjacent to streetscape projects, as well as the level of pedestrian traffic on individual blocks.

DPW will improve a total of 294 miles of roads, focusing on residential streets that are most in need in conjunction with neighborhood planning efforts. The major corridors that will see improvements will be selected based on condition, traffic volumes and adjacent residential and commercial development. Federal and state transportation funds are typically used along with city sources. The additional bond funds will be used to complement these funding sources, allowing for accelerated road improvements over the first three years of neighborhood redevelopment plan.

 

List of bond funded commercial corridor projects

  1. Livernois 3 miles
  2. McNichols 0.5 miles
  3. Jefferson 6.0 miles
  4. Jefferson 1.1 miles
  5. Jos Campau 4 miles
  6. Kercheval 1 miles
  7. Vernor 0 miles
  8. Bagley 1 miles
  9. Bagley 2 miles
  10. Rosa Parks 5 miles
  11. Russell  1 miles
  12. Russell 9 miles
  13. Beaubien 5 miles
  14. Fisher Fwy. Service Dr. 1 miles
  15. Warren  1.0 miles
  16. Vernor  0.3 miles
  17. Dexter 4 miles
  18. Lawley 7 miles
  19. Davison Service Dr. 0.4 miles
  20. Elliott  0.5 miles
  21. Van Dyke 5 miles

 TOTAL                                           21.6 Miles

Editor’s Note: Jackie Berg is the founder and publisher of TheHUB

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