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Home News  Accident Fund: If we build it, can they come?
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Wednesday, May 18,2011

Accident Fund: If we build it, can they come?

by Kyle Melinn

Like just about everyone else in town,
downtown worker Judy Putnam was marveling at the gorgeous new Accident
Fund headquarters the other day when she got the itch to peek inside.


What’s the harm, right? It’s not the
Sears Tower or the Empire State Building, but this is the closest thing
we have to cool in Lansing. Surely they wouldn’t mind if someone wanted
to see the lobby ... .


"No" was the courteous, but assertive answer from the paid security.


How about a tour? Putnam asked. 


Again, No. 


How about a short little gaze around the lobby?


No.


"I was a little irritated," she said. "We weren’t trying to roam around the building or kick the tires or something."


Her agitation was compounded by the fact a
bucket of tax credits and special federal, state and local goodies were
given to the Lansing-based workers compensation firm to keep it in the
capital and renovate a deteriorating structure originally built to burn
coal for electricity.


Consider this: The property of the old
Board of Water and Light Building was constructed in a Renaissance Zone,
meaning it is exempt from paying local property taxes for 15 years.
That’s $9.75 million the city would get otherwise.


After 2025 or thereabouts, the $33
million it pays in future property taxes is given to the Lansing Tax
Increment Finance Authority (TIFA) to pay for the costs of making the
old power plant usable — moving the water chillers and tearing down that
hideous parking deck that spanned Grand Avenue, for example.


The company got another $10 million in
brownfield credits from the soon-to-be former Michigan Business Tax,
which it can cash in on 90 cents to the dollar after the tax goes away.
The historic tax credits used on the 105,000-square-foot building total
around $11 million.


The Michigan Economic Growth Authority
awarded it a separate 12-year, $9 million tax credit, and the Department
of Environmental Quality ponied up $3.2 million for public riverfront
improvements, including the building of a public park on both sides of
the Grand River.


The U.S. Environmental Protection Agency also assisted in the cleanup to the tune of around $600,000.


And, to boot, the city used its bonding
authority to build the $31 million parking ramp on the side of the new
structure next door to the old power plant with the understanding that
the money would be paid back over time.


Not counting the ramp, that’s $76.5
million in would-be state and local tax money that is either a) staying
with the company or b) going into sprucing up seven acres of highly
visible downtown riverfront over the next 30-some years.


Now, I understand the cost of not doing
the project. I do. Not dangling these tax credits in front of the Blue
Cross/Blue Shield of Michigan affiliate would have meant this $180
million project doesn’t happen. These incentives would have been spent
somewhere else. Not Lansing.


It’d have meant the growing Accident Fund
moves its headquarters into bigger digs in Delta Township or even
Milwaukee. Its 632 jobs are out of Lansing and 500 other jobs aren’t
coming downtown. That’s an $8 million loss in Lansing employee income
tax money over 30 years.


Follow the dominos. Blue Cross/Blue
Shield wouldn’t be moving into the Accident Fund’s old building next to
Cooley Law School. Lansing now has two empty buildings to hide from.


God knows another tenant probably wasn’t
coming for the Board of Water and Light Building. It was destined for a
wrecking when the smokestacks showed signs of tumbling. 


But the use of the public’s resources
does give us a little skin in the game. All Lansing and state taxpayers
are partners in the fantastic success of this project. Marveling at the
handiwork inside isn’t a big ask.


The Accident Fund’s media relations
professional, Stephanie Schlinker, did end up offering Putnam a tour
after the latter posted a disappointed Facebook post.


Schlinker wrote that the security guards
can be a little intense, but they’ve had to contend with people making a
beeline for the elevator or the stairs, which "tends to freak our
employees out."


The company had considered doing regular
tours, but opted instead to do public tours by request. Sarah Garcia
(sarah.garcia@accidentfund.com) was put in charge of organizing all of
that. The security guards are being briefed on what to tell Putnams of
the future.


That’s great. The Accident Fund’s media
tour in late March exceeded my expectations. My Facebook post that day
read, "The three-sided view from the ninth floor makes you fall in love
with the city of Lansing."


I’d hope others get to experience that feeling, too.


Kyle Melinn is the editor of the MIRS Newsletter. He can be reached at melinnky@ameritech.net.

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