Business

Detroit Executive on Gilbert Team Disputes Tax Breaks Article as 'Demonstrably False'


October 28, 2019, 7:43 AM

A vice president at the Rock Family of Companies strongly disputres an investigative report by ProPublica that casts the firm as unfairly opportunistic.

Last week's article, headlined "How a Tax Break to Help the Poor went to Cavaliers owner Dan Gilbert," said:

"Gilbert’s cultivation of the Trump family appears to have paid off: Three swaths of downtown Detroit were selected as opportunity zones under the Trump tax law, extending a valuable tax break to Gilbert’s real estate empire."


Dan Gilbert (Photo: Video screengrab from ADrinkWith.com)

The breaks are meant for low-income residents, the public-interest news site says, not moguls like Gilbert.

Jared Fleisher, vice president of government affairs and economic development for the Rock group that's part of Gilbert's empire, pushes back forcefully in a guest column in Cleveland.com. Excerpt:

Some things in life are simple. The ProPublica story published in the Oct. 27 Plain Dealer about opportunity zones is simply not true. . . . I stake my name, my reputation and the reputation of my organization on that.

ProPublica’s thesis is that the Rock Family of Companies plotted — starting years ago — to get the opportunity zone program enacted to law by cozying up to the president. Then, we somehow manipulated the objective process that determines whether areas are eligible to be opportunity zones and then pushed the state of Michigan into actually designating certain areas as opportunity zones for our benefit.

The problem is that each step of that tale is demonstrably false.

First, opportunity zones were never a legislative priority for our company. Lobbying disclosure records show no lobbying on this issue before the law was passed. The organization that led the advocacy effort, the Economic Innovation Group, will tell you that we were not involved in any meaningful way, shape or form. Indeed, email records show that we didn’t even know the program was passed into law until many days after the fact — hardly what you would expect from supposed leaders of the effort.

Second, the allegation that we manipulated the process to make the census tract in question (the western half of downtown and the west riverfront) eligible to be an opportunity zone is impossible. Eligibility was based on objective, technical criteria. This is like saying we are so powerful that we contrived to have two plus two equal four when, in reality, four was the answer all along.

ProPublica’s documents show the city of Detroit consulting with us — along with a number of outside experts — to determine which areas were eligible before the federal government released the lists. We had a different analysis for this tract, because this is incredibly complex stuff. The U.S. Treasury Department ultimately confirmed that analysis when it put out the final lists. That is truly it, nothing more. Even the ProPublica article quotes the Treasury Department as responding, in essence, “I have no idea what you are talking about; we have never heard of these people,” when referring to Rock personnel.

Third, ProPublica’s theory that we exercised some undue influence in getting that area actually designated as an opportunity zone is equally absurd. Every major planning document and strategy identifies these areas — the west riverfront, Corktown and the western portion of downtown — as economic development focus areas and targets for investment. It would be unthinkable — malpractice even — to not include this area in an economic development program, which is why the city included it.


Read more:  Cleveland.com


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