May 30, 2009 at 1:00 am

29th Mackinac Policy Conference

Detroit, Warren spar over best location for GM

Mackinac Island -- The war of words between Detroit and Warren escalated Friday over which city can offer the best incentives for GM's world headquarters.

For its part, the automaker is staying silent on its future plans.

After a decision was announced early Thursday to award Wayne County's last "Renaissance Zone" designation to the Renaissance Center, Mayor Dave Bing called Warren Mayor Jim Fouts' attempt to lure GM's headquarters "asinine." Fouts wants GM to move its 4,500 white-collar jobs to the Tech Center in his city and he offered the company a 30-year tax-abatement.

In response Fouts said he was "shocked Dave Bing would resort to mudslinging" but was encouraged that even if GM opts to stay in the Renaissance Center, the posturing will ultimately help the struggling automaker.

"What I really care about is the survival of General Motors," Fouts said.

About 15,000 GM workers are employed at the company's Tech Center in Warren and there likely would be room for the workers from the RenCen, which sits on the Detroit riverfront and anchors downtown.

GM spokesman Tom Wilkinson said the company's public policy staff was evaluating the proposals. "We have no comment at this time," he said.

City and state officials continued their lobbying of GM and government officials on Friday hoping to stop any effort to force the automaker to move as part of its restructuring under federal pressure.

Bing sent a letter to President Barack Obama saying the headquarters "is absolutely essential to the health and vitality of the city."

"While I understand the need to restructure, I'm sure you don't want to gut the heart of Michigan's largest city, and most notably one of the nation's hardest hit cities during this economic crisis," Bing wrote. "Therefore, I implore you to take the necessary actions to restructure General Motors, while preserving its corporate headquarters."

Adding his voice to the call that GM remain in Detroit was U.S. Rep. John Conyers, D-Detroit, who also wrote to Obama to express concern about such a decision. "The prospect that General Motors might move its headquarters from the downtown Renaissance Center to the Warren Tech Center two miles north of city limits would be a big blow to Detroit," he said in a written statement.

Gov. Jennifer Granholm and much of the Michigan congressional delegation also sent a letter Friday to GM CEO Fritz Henderson, asking him to drop the idea of abandoning the RenCen.

"A decision by GM to vacate its Renaissance Center headquarters would be devastating both substantively and symbolically to Detroit, a city that has been accurately labeled as 'ground zero' in the nation's severe economic crisis," the letter reads. "If GM were to leave the city, it would take with it thousands of employees and millions of dollars of Detroit tax revenue and reinforce Detroit's unwarranted perception as a city increasingly abandoned by its people and businesses."

Among the letter's signers: Granholm, Lt. Gov. John Cherry, both the state's U.S. senators and 10 of the state's 15 House members, along with several local officials. Significantly, Macomb County Board of Commissioners Chairman Paul Gieleghem signed. The county's two representatives in Congress, Reps. Candice Miller, R-Harrison Township, and Sander Levin, D-Royal Oak, did not sign.

Early Thursday, Bing and Wayne County Executive Robert Ficano met privately at the Mackinac Policy Conference to see what they could offer to GM.

Ficano described the deal-brokering as "sticky."

"We are sending a strong message to the world that Mayor Bing and I are committed to creating the most business-friendly climate this region has ever seen."

Still, the Renaissance Zone designation, which could possibly save GM as much as $25 million according to a review of property tax records, is not a guarantee. The status must be approved by the Michigan Economic Development Corp., and the company would need to agree to not move out of the iconic complex.

On Monday, GM is expected to file for federal bankruptcy protection.

Of the complex's seven towers, the one occupied by EDS has the special designation, which eliminates nearly all real estate and personal property taxes, as well as income and utility taxes.

This plan would include 2.2 million square feet of office space in the four main towers as well as the Detroit Marriott Hotel in the center tower.

"We have no choice," Bing said, explaining the rationale to offer the tax incentives.

He said he did not know how much tax revenue the state, city, county and local school district would lose but noted that figure is irrelevant.

"We'd lose much more than that if they would leave," he said.

Bing, known for a soft-spoken demeanor, told Fouts to "back off" in his attempt to lure away GM.

"For him to do what he is doing right now is asinine," Bing said. "We don't need to do that and ... he didn't talk to any of us ... nor has he talked to anyone from GM."

Bing said that the use of substantial tax breaks was inevitable because if GM does move its headquarters, the city would have to use a similar tactic to attract a business to replace the automaker.

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