• City to forgive $11.6M school debt in exchange for vacant properties
• Deal lets DPS focus on educating children while city prepares to secure or demolish empty structures, maintain grounds.
10/18/2014 – Detroit Mayor Mike Duggan and Detroit Public Schools Emergency Manager Jack Martin have reached an agreement that will erase millions of dollars in debt DPS owes the city and address 77 vacant school properties scattered throughout the city’s neighborhoods.
Under the agreement, the city of Detroit will forgive $11.6 million of debt – primarily electric bills – in electric bills DPS owes the city. In exchange, DPS will turn over control of 57 vacant schools (31 secured and 26 unsecured) and an additional 20 vacant lots where schools once stood. According to DPS, the value of the properties is equal to the amount the district owes the city.
Initially, the properties will be placed in escrow, pending the results of environmental assessments. Over the next three months, the city will conduct an environmental analysis of each school property to determine how much remediation may be required. During that time, the city will assume responsibility for maintaining and securing the properties.
“This agreement is great for our neighborhoods and DPS school children, Mayor Duggan said. It allows DPS to put all of its energies into its core mission, which is to educate our children. It also recognizes that the city is better suited to addressing the important issue of neighborhood blight and redeveloping these properties in a way that is in harmony with the surrounding community.”
“Detroit Public Schools appreciates the City of Detroit for working with us to ensure that our resources can be 100% focused on the district’s nearly 50,000 students and the quality teaching and learning that takes place each and every day in the classrooms of our 97 schools,” said DPS Emergency Manager Jack Martin. “Our primary focus must be the education of the children of Detroit. This agreement allows us to stay laser-focused on this mission.”
Benefits to the City
• The City has access to available demolition funds to remove the buildings that can’t be saved.
• The City has access to employment programs to fund the work to secure the buildings that can be saved.
• Neighborhoods are protected from potential land speculators.
• The City would have the opportunity to partner in the redesign of neighborhoods to create greenways, community gardens and recreation space.
• The new local Detroit Water and Sewer Department could use some of the properties as green infrastructure, providing large open spaces for water retention projects to alleviate possible basement flooding from major storm events.
How the city will pay for securing, demolishing and maintaining properties
• Environmental Assessment: The estimated cost of the environmental studies is $2 million, which will be paid for by Quality of Life funding approved for neighborhood blight removal by bankruptcy judge Stephen Rhodes. Once each assessment is completed on each property, title will be transferred to the City of Detroit. If the city determines that the level of contamination at a property would make it prohibitively expensive to clean up, it will return the property to DPS, which will have the option to offer another vacant property to the city or reimburse the city in amount originally assigned to the property.
• Grounds Maintenance: Several of the closed schools still have playground equipment and are being used by the neighborhoods as a recreation area. These playgrounds will be maintained by the City General Services Department as City parks and maintained within the parks budget.
• Demolition: Mayor Duggan said the city already has identified $4.3 million in NSP funding that will allow crews to demolish the 10-12 most dangerous vacant schools by mid July. Demolition of other schools will come later as additional funding is identified. Former school buildings on these properties that are still viable, as well as vacant lots, will be marketed for redevelopment by the city.
• Securing Vacant Buildings: Approximately half of the 57 school structures are currently open to trespass, posing a threat to the community. To address this, the city will use another $1 million in QOL funding for materials to secure the vacant buildings. The Detroit Employment Solutions Corporation will provide funding to hire up to 150 youth, ages 18-21, to for the purposes securing vacant buildings.
Partnership with Building Trades will provide opportunity for youth
In all of the work – securing, demolition and environmental work – Mayor Duggan pledged that the city will make it a priority to utilize Detroit based minority owned businesses to do much of the work. The city also will hire DPS students to assist in the work of securing the buildings, which will give them hands-on skilled trades training and experience.
Next Steps
Yesterday, Mayor Duggan presented the proposal to Detroit City Council, which has been briefed on the details. The Mayor has asked Council to pass a resolution approving the deal.
DPS Emergency Manager Jack Martin will present the proposal to the Detroit School Board for consideration at its next board meeting.
Once the deal is approved, the city can begin immediately to get the demolition process started for the first 10 buildings by July 15th.
