The “Billionaire Boys” — Dan Gilbert and Tom Gores — have spoken: they want the white-elephant Wayne County Jail property site to be used for a commercial, residential, and entertainment playground — including a 25,000-seat soccer stadium. When money talks, people listen, but at what cost will this come to the taxpayers of Wayne County who have sunk $157 million into a jail project for basically a foundation and a few walls when the project was halted?
At that point, the estimated tab was $41 million over budget and $391 million in total. (The numbers are fast and loose and seem to change with every story researched. Just know it appears to be incredibly expensive to build a jail at the rate approaching $200,000 per bed). Additionally, there is an ongoing carrying cost to Wayne County of $1.2 million a month for the $200 million of bonds initially issued to build the jail.
With Detroiters and the region rooting for the city to succeed, we should all be able to agree, that coming off the I-375 Madison exit with the jail being the first thing you see — regardless of how nice they may dress it up — is not the first impression the new District Detroit should provide. Likewise, the property then becomes non-revenue producing space for the life of the jail.
It seems the behind-the-scenes talks have broken down when Wayne County Executive Warren Evans at his state of the county address in February vehemently stressed the partially completed jail would be finished on the present site. Then — roughly two months later — Gilbert and Gores roll out a shiny new concept complete with artist renderings and animations in an attempt to sway the taxpayers and public sentiment without so much as a deal in hand.
The $50 million Gilbert offered for the property in 2013 may seem reasonable for an empty lot; however, the real question is how does the $151 million hard-cost already spent by Wayne County translate into a win-win for the taxpayers and the billionaires, and at what will be the additional cost to the taxpayers?
Accepting the $50 million offer — and who knows what the latest offer was when recent talks may have been halted — still leaves the county more than $100 million in the red, plus the cost of building the new jail. Evans seems to control the cards, and the real solution may be easier than it seems considering the county needs a new 2,000-bed jail and the “Billionaire Boys” want the land the current project sits on.
Therefore, take the building and contracting expertise that Gilbert has in his portfolio and give him and Gores the building specifications and edict to be the general contractor for building the jail at the current Mound Road complex in exchange for the site they desire. Wayne County kicks in the remainder of the unspent bond funds along with the estimated amount to finish the jail on the current site towards the plan, the Billionaires pick up the rest.
Since the construction process will now be privatized and incentivized, the all too common waste (and suspected fraud the current site experienced) as managed by the county will be eliminated. Gilbert and Gores pay for it to be built in the most economical fashion possible meeting the required specifications, and in turn, they get the current jail site, free-and-clear. As a bonus, if they also build new courts along with a juvenile detention facility at the Mound complex, they will also get the current sites of the Frank Murphy Hall of Justice, 36th District Court, and neighboring justice facilities, free-and-clear to develop as well. What’s more, Wayne County would realize a new source of revenue for the Gilbert/Gores project in the form of property taxes and other levies.
With an estimated $8.7 billion of combined net-worth, let’s give Gilbert and Gores the opportunity to put their money where their mouth is while putting the taxpayers in the same financial situation as if they had finished the jail on the current site.
Justin Winkelman is a business consultant in the areas of strategic planning, business operations, risk management, and social media marketing and implementation.