Vacant properties on streets such as Leander near the east side airport would be absorbed into developments in a move to draw residents and jobs. (David Coates / The Detroit News)
Detroit— A plan to turn Coleman A. Young Municipal Airport and the surrounding neighborhood into a freight center and autonomous area was one of many recommendations by an expert panel Thursday to help pave the way for Detroit’s comeback.
As the city prepares to file its debt-cutting bankruptcy plan today, policy experts suggested selling or leasing city assets and contracting out more services to private companies at a discussion in the Hotel Crowne Plaza Pontchartrain sponsored by the libertarian Reason Foundation.
The city’s small airport on the east side was identified as an asset that could generate money for the city through a long-term lease to a private firm by Leonard Gilroy, director of government reform for the California-based Reason Foundation.
“If you don’t make a serious effort to put everything on the table, it will set a bad precedent,” he said.
Local homebuilder Rodney Lockwood Jr. went further by proposing to shift and lengthen the Detroit municipal airport’s runway to become a freight center for general and corporate aviation as well as draw residents and jobs. The current runway is considered too short to handle larger passenger jets and freight aviation.
The improvements at the municipal airport are among those in his proposed Jefferson Community Investment District, a 15-square-mile area he envisions could aid in redeveloping vacant properties and become an attractive opportunity for creditors, investors, homesteaders and residents.
Lockwood, chairman and CEO of Lockwood Companies in Bingham Farms, said he wants to present the plan to Emergency Manager Kevyn Orr and officials in Mayor Mike Duggan’s administration.
“This could be a great anchor on the east side of Detroit,” he said.
Orr’s spokesman Bill Nowling said Thursday he hadn’t heard of Lockwood’s plan and the office would withhold comment until a formal proposal is presented.
This isn’t the first time Lockwood has suggested a radical concept. In January 2013, he urged the city to sell Belle Isle for $1 billion to investors who would turn it into a 982-acre, free-market commonwealth — an idea that generated national attention but went nowhere with city government.
Lockwood said he envisions the Jefferson district as a multimodal freight center that could take advantage of the airport, nearby freeways, rail and the Detroit River for shipping while not directly competing with Detroit Metro Airport in Romulus.
The proposal, Lockwood said, calls for the city to turn over assets within the district boundaries to a public-private company with five shareholder groups, primarily creditors. In exchange, the city would get a percentage stake in the company. The land sales would pay creditors and increase the value in the district, which would eventually be returned to the city’s control, he said.
“Autonomy is part of the deal,” he said.
Vacant properties could be redeveloped by letting homesteaders buy them for $1 and agreeing to share an increase in value with the public-private company, Lockwood said.
Lockwood estimated he would need to raise $3 billion from investors and through an initial public offering.
But the homebuilder said he selected the Jefferson Avenue area because there are so many vacant lots that he figured had a better chance at political success than the Belle Isle idea.
“We selected this area because it is politically possible,” Lockwood said, adding later that “Detroit is too big to be governed and just begs to be partitioned.”
Panel moderator Shikha Dalmia, a Metro Detroit-based senior analyst with the Reason Foundation, agreed that a “pilot project” such as Lockwood’s is more doable, but noted the political firestorm around leasing Belle Isle to the state. The City Council rejected the idea, but Orr got a 30-year lease approved by the state’s Emergency Loan Board.
Another asset that presents a “significant opportunity” for the city to generate cash is leasing its 3,000 parking meters and 10,000 parking spaces between six city-owned garages and lots to private firms, Gilroy said.
“Oddly, it’s starting to become a hot asset in the U.S.,” he said of parking. “In Detroit, it’s something Kevyn Orr has also put on the table. We may see that in the plan of adjustment.”
Michael LaFaive, director of fiscal policy for the Mackinac Center for Public Policy in Midland, pointed to successes in Pontiac as a model for Detroit to follow after years of success under state-appointed emergency managers.
LaFaive said Pontiac has saved $5.8 million annually through shared-service agreements for its police and fire services.
“But it also appears that those services have improved dramatically too,” he said.