Administration defends bond request

Sunday Times Newspapers


ALLEN PARK — City officials defended their recent declaration of intent to seek municipal bonds after a former mayor questioned their actions last week.


During Tuesday’s City Council meeting, former Mayor Richard Huebler questioned the council’s request for up to $40 million in municipal bonds for the city’s proposed film studio project.


Officials have said the bond money would be used to create infrastructure to sustain the studio on 104 acres of land on Enterprise Drive north of Southfield.


Officials in January announced the proposed $100 million studio project that would create over 3,500 jobs. They have been working with a studio executive, who they cannot name under confidentiality agreements, Wayne County and the state to push the project through.


A new municipal complex that would include City Hall, new Police and Fire departments, a library, Department of Public Works and possibly the 24th District Court.


The $40 million bond sale would take place only if the film studio project moves forward.


However, Huebler asked the council why residents did not have a vote on the bond issue, saying his criticisms are based only on the information that has been released to the public because of the confidentially agreements.


“This council has put out a notice that you want to bond up to $40 million for 30 years at a rate not to exceed 8 percent,” he said, “and then you told the citizens that they could get a vote if they can get a referendum petition put together.


“I say that is a clever move.” He said residents would have to organize, get financing and an attorney, write up paperwork and get several thousand signatures in order to be able to vote on the bond.


“That’s how they get their right to vote is to go out and fight for it,” Huebler said, “not that this council wants to give it to them.”


He also questioned officials’ decision to include a new municipal complex with the studio infrastructure.


“You’re also talking about building municipal buildings,” he said. “The citizens turned down a millage request for a police and City Hall building.


“Now it appears you have gone another direction to get the same thing accomplished.”


He added that he did not believe such a bond could go through without raising residents’ property taxes, which officials say they had no intention of doing.


“I think if this council wants to be transparent,” Huebler said, “they ought to have enough faith in the project they are putting up to put this thing to a vote of the general public.”


City Administrator Eric Waidelich said the city has no intention of raising taxes, and that the potential bonding is directly related to the film studio project.


“If the film studio project does not come to fruition, then the bonding activities will also not come to fruition,” he said.


Waidelich said the vast majority of the funding is for infrastructure to be able to handled the proposed development. He added that there was no intention of reaching the requested $40 million, and that the number was just a recommendation made to them by legal counsel and city Finance Director Kim Kleinow.


“The recommendation was to put in a greater number in the event of some unexpected costs,” Waidelich said. “But right now that is not part of the financial strategy.


“That (money) is the city’s commitment should the opportunity come to fruition, so the developer themselves would bring in over $150 million in development, not to mention in excess of 3,500 full-time jobs.”


He added that Mayor Gary Burtka has negotiated into the studio agreement that city residents will get the first employment opportunities whenever possible.


“If you believe that the film studio project, the jobs it will create, the stability it will bring, the revenue it will generate, is worth the city reinvesting in itself,” he said, “then the bonding is value added.


“If you do not believe that the studio is a worthwhile development, and what is has to offer and what it has to bring, then you would be against the bonding.”


Councilman Kyle Tertzag said he is 100 percent behind the project, and that it will mean millions of dollars of development in the city.


“People shouldn’t be in the frame of mind that this mayor and council are going to raise taxes without a vote of the people,” he said. “That will not happen and that legally cannot happen. It’s not possible.”


Burtka said the administration is looking toward the future with the project and not living in the past.


“We can either curl up in a ball or sit back in a corner and wait for this economic condition to pass,” he said, “or we could think outside the box and think to the future and look to where Allen Park can be.”


He added that investing money into the city will reap a greater reward in the long run.


“We think outside the box, yes, we sometimes spend money when we think we can get a return on it,” he said. “And yes, we will continue to do that when we think it is in the best interest of the community.”