1
BY COUNCIL MEMBER__________________________________________:
2
AN ORDINANCE to amend Chapter 14 of the 1984 Detroit City Code,
3
Community Development, by adding Article XII, titled Community Benefits, Section 14-
4
12-1, to require Community Benefits Agreements for certain development projects
5
IT IS HEREBY ORDAINED BY THE PEOPLE OF THE CITY OF DETROIT
6
THAT:
7
Chapter 14 of the 1984 Detroit City Code, Community Development, Article XII,
8
Community Benefits, read as follows:
9
ARTICLE XII Community Benefits
10
Sec. 14-12-1. Community Benefits Agreements.
11
It shall be the policy of the City of Detroit to require, wherever feasible,
12
proportional community benefits as a condition of significant public support for
13
development in the form of subsidies, tax abatements, below-market priced land or other
14
enhanced public resources.
15
Section 1. A. For purposes of this Section, “Host Community” shall mean and
16
include the community within the census tract(s) where the development project is physically
17
located and may also include communities within adjacent census tracts that may be
18
adversely affected by the activities of the development project, as determined either by
19
agreement among members of the Host Community representative party to a Community
20
Benefits Agreement, but shall in no case be smaller than the census tract where the
21
development project is physically located.
22
B. For purposes of this Section, “First Source Hiring Program” shall mean a
23
collaborative partnership between the developer, the City of Detroit and an appropriate
24
workforce development agency, that to the extent consistent with federal and state law,
1
includes provisions to promote the hiring, training, and employability of residents and
2
displaced workers from the Host Community, including both construction and permanent
3
jobs in connection with a project.
4
C. For purposes of this Section, “Contractor” means any person, firm, partnership,
5
limited liability company, corporation, joint venture, proprietorship, or other entity that
6
enters into a contract for performance of construction work on the development project
7
within the Host Community, including subcontractors of any tier.
8
9
D. The following standards and requirements shall apply to Community Benefits
Agreements as a condition of public support for investments:
10
1) For any proposed development project in the City of Detroit that proposes
11
public and/or private investment of Fifteen Million ($15,000,000) Dollars or more, with
12
either a) direct or indirect transfer of city-owned land parcels or other public property
13
without open bidding or priced below market rates to the developer, as determined by the
14
City Assessor or independent appraisal; or b) receipt of other forms of public subsidies by
15
the developer, including but not limited to tax abatements or grants that are cumulatively
16
valued as Three Hundred Thousand ($300,000) Dollars or more, but not including
17
Neighborhood Enterprise Zones, the developer shall engage Host Community residents
18
for purposes of entering into a legally enforceable Community Benefits Agreement with
19
representative residents, businesses and nonprofit organizations, collectively comprising
20
the Host Community representative party to the agreement, to provide targeted benefits
21
or appropriately negotiated employment opportunities, job training, low- and moderate-
22
income housing, quality of life or environmental mitigations, neighborhood infrastructure
23
and amenities, and community representation for the benefit of the Host Community in
2
1
the development and post-development processes, which shall approximate the value of
2
the public support for the project, as required by this Section. Unless good cause is
3
shown by a developer as provided in paragraph 1.F. of this Section, the Host Community
4
representative and the developer for a project shall negotiate and execute a Community
5
Benefits Agreement before the issuance of any project-related grants, tax abatements, or
6
transfers of city owned land or property, or before other forms of subsidy are granted or
7
awarded by the City of Detroit. Violation of this Section without good cause shown by a
8
developer as provided in paragraph 1.F. of this Section, shall result in denial of approval
9
for any such requested public land transfer and/or public subsidies.
10
2) For any proposed development project in the City of Detroit that proposes the
11
public and/or private investment of more than Three Million ($3,000,000) Dollars, but
12
less than Fifteen Million ($15,000.000) Dollars during the construction of facilities or
13
plant, or to begin or expand operations or renovate structures, together with either of the
14
following: a) direct or indirect transfer of city-owned land parcels or other public
15
property without open bidding or priced below market rates to the developer, as
16
determined by the City Assessor or independent appraisal; or b) receipt of other forms of
17
public subsidies by the developer, including but not limited to tax abatements or grants
18
that are cumulatively valued as Three Hundred Thousand ($300,000) Dollars or more, the
19
developer shall adopt and implement a First Source Hiring Program for residents of the
20
Host Community, but shall not be required to provide any other community benefits
21
referenced in Section D.1., as a mandatory condition precedent.
22
3) For any proposed development project in the City of Detroit that proposes the
23
public and/or private investment of more than Three Million ($3,000,000) Dollars during
24
the construction of facilities or plant, together with either of the following: a) direct or
3
1
indirect transfer of city-owned land parcels or other public property without open bidding
2
or priced below market rates to the developer, as determined by the City Assessor or
3
independent appraisal; or b) receipt of other forms of public subsidies by the developer,
4
including but not limited to tax abatements or grants that are cumulatively valued as
5
Three Hundred Thousand ($300,000) Dollars or more, that because of the nature of the
6
development and/or the Host Community, is reasonably expected to produce
7
disproportionately high and adverse human health or environmental impact, including
8
social, esthetic, economic, physical, chemical, or biological impacts in the Host
9
Community, Detroit City Council may determine that the requirements of Subsection
10
D.1. shall apply, after a public hearing requested by a resident of the Host Community
11
and duly noticed and conducted for the purpose of ascertaining whether or not the
12
development project can reasonably be expected to produce any such impact, but not
13
including Neighborhood Enterprise Zones.
14
E. Examples of community benefits or provisions that may be incorporated into a
15
legally enforceable Community Benefits Agreement include, without limitation:
16
1. A First Source Hiring Program for residents of the Host Community;
17
2. A requirement that 51% of Contractors retained to provide services relating to
18
the development project will consist of Detroit-based and Detroit-
19
headquartered businesses (DBBs) and/or Emerging Small Business (ESBs)
20
with less than One Million ($1,000,000) Dollars in gross annual receipts; and
21
50% of all such Contractors will be Detroit-headquartered businesses;
22
3. Workforce Development Programs:
4
1
a. Where specialized technical training is necessary for employment in
2
the developer’s business, pre-apprenticeship, apprenticeship, and other
3
training in the City’s high schools, community colleges and workforce
4
training programs, including but not limited to agencies such as the
5
Detroit Registered Apprenticeship Program and the Access for All
6
apprenticeship readiness programs targeting residents of the Host
7
Community;
8
b. One or more adult pre-apprenticeship programs operated by one or
9
more qualified administrators or an administrative collaboration
10
comprised of organizations that benefit residents of the Host
11
Community, including but not limited to agencies such as the
12
Partnership for Diversity and Opportunity in Transportation;
13
c. Actively supporting workforce development activities that provide
14
employment opportunities for residents of the Host Community,
15
including but not limited to programs through federal workforce funds
16
received annually and allocated by agencies such as the State’s
17
Michigan Works! partner, Detroit Employment Solutions Corporation
18
or another appropriate workforce development agency or entity ;
19
d. Providing annual Contractor readiness training for Detroit-based small
20
businesses, through the United States Department of Transportation
21
Bonding Education Program or other relevant training opportunities;
5
1
e. Hosting annual Contractor information and networking sessions about
2
upcoming contracting opportunities with MDOT in the City of Detroit;
3
and
4
4. Youth Employment Programs:
5
a. Programs to require Contractors, subcontractors and developers to hire
6
City youths in the Host Community, including but not limited to
7
agencies such as Transportation and Civil Engineering (TRAC)
8
summer internship positions to qualified Detroit youths;
9
b. Providing program materials, training and support for Detroit Public
10
Schools/CTE (DPS) or other educational institutions in the Host
11
Community;
12
c. Providing employment and career mentoring opportunities for youths
13
who reside in the Host Community, including but not limited to
14
MDOT's Youth Development and Mentoring Program;
15
5. Land Use Programs:
16
a. Actively promoting City real estate and investment opportunities in the
17
Host Community through agencies such as the Michigan Prospectus or
18
another appropriate real estate investment agency or entity;
19
b. Providing additional recreational opportunities, parks, educational
20
services, environmental amenities, housing capacity or other benefits
21
in the Host Community;
22
23
c. Providing funds for demolition of abandoned residential homes in the
Host Community;
6
1
6. Provisions that require periodic reporting, the frequency to be determined by the
2
parties, of activities and ongoing monitoring of compliance by the parties
3
throughout the course of the project;
4
7. Provisions that require the parties to periodically meet and confer, the frequency
5
to be determined by the parties, and disclose the parties’ activities and the status
6
of compliance to Host Community residents, and that require periodic public
7
meetings with the opportunity for input and comments by Host Community
8
stakeholders;
9
10
11
12
13
8. A community needs assessment regarding the Host Community at the developer’s
expense;
9. An environmental and/or public health assessment of the impacts of the proposed
development at the developer’s expense; and/or
10. Specified remedies for violation of the Community Benefits Agreement,
14
which unless otherwise agreed by the parties, may include, without limitation liquidated
15
damages, claw backs, or revocation or withdrawal of tax abatement and public subsidies,
16
either directly by the City of Detroit, or by application to the Michigan Tax Tribunal, as
17
provided by law.
18
F. The developer may request, from the City Council, an exemption from the
19
requirement of entering a Community Benefits Agreement where it can demonstrate that:
20
(1) Identifying a Host Community representative to negotiate with on behalf of
21
22
23
the Host Community is infeasible or impractical; or
(2) Good faith negotiations have occurred for a reasonable time period, but
negotiations have reached an intractable impasse; or
7
1
(3) Other exigencies make entering a Community Benefits Agreement infeasible
2
in the particular instance.
3
To request an exemption, the developer shall set forth in writing the basis of its
4
request and document how it will otherwise seek to implement the intent of this Section
5
to provide the Host Community with benefits from the development.
6
G. The terms a Community Benefits Agreement under this Section shall be
7
incorporated into the development agreement, if any, between the City of Detroit and the
8
developer of the project. Integration of the terms of the Community Benefits Agreement
9
into any such development agreements shall not change, alter or diminish the legal and
10
equitable duties, rights, and remedies of the parties to the Community Benefits
11
Agreement, and nothing in any such development agreement shall preclude, prevent, or
12
otherwise limit the Host Community representative party or its successors from having
13
standing to enforce a Community Benefits Agreement.
.
14
H. All City of Detroit Executive Branch Departments, Divisions and Agencies
15
involved in economic development projects or activities, as well as the Detroit Economic
16
Growth Corporation, shall provide a copy of this ordinance to each potential developer,
17
upon first contact regarding any particular economic development project proposal, to
18
provide the developer with notice of the requirements of this Section.
19
20
21
22
Section 2. All ordinances, or parts of ordinances, that conflict with this
ordinance are repealed.
Section 3. This ordinance is hereby declared necessary to preserve the public
peace, health, safety, and welfare of the People of the City of Detroit.
8
1
Section 4. In the event that this ordinance is passed by a two-thirds (2/3) majority
2
of the City Council Members serving, it shall be given immediate effect and become
3
effective upon publication in accordance with Section 4-116 of the 1997 Detroit City
4
Charter. Where this ordinance is passed by less than two-thirds (2/3) majority of the City
5
Council Members serving, it shall become effective no later than thirty (30) days after
6
enactment in accordance with Section 4-115 of the 1997 Detroit City Charter.
7
Approved as to form:
8
9
10
_________________________________
Corporation Counsel
9