Standing committee for Wednesday, October the 15th, 2025.

Will the clerk please call roll?

Councilmember Fred Johall the third.

Present.

Councilmember Coleman Young, the second.

Councilmember Gabriel Santiago Romero.

Present.

Mr.

Chair, Gary Decorn.

Thank you, Mr.

Clerk.

Next we'll move to approval of the minutes.

Members have been provided the minutes from last meeting.

Is there a motion to do so?

Motion.

Hearing no objections, that action shall be taken.

We have a pretty short agenda today.

We have an audit discussion that will be coming up.

Our auditor general is joining us and just a couple other items on the agenda today.

That being said, we'll go directly into public comment.

Each member of the public will have two minutes for public comment.

We ask that you state your name for the record and then proceed speaking.

Seeing that there are no members of uh or residents in the committee of the whole, we'll move directly to uh virtual public comment.

If you wish to participate in virtual public comment, please indicate so now by raising your hand via the zoom feature.

Again, you will have two minutes for public comment.

Uh we are getting ready to close public comment.

Public comment going once.

Public comment going twice.

Public comment going three times.

Public comment is now closed.

Good afternoon, Mr.

Payne.

How many callers do we have today?

Good afternoon, Mr.

Chair, honorable committee members.

We have six raised hands.

Six callers calling in for public comment.

Who is our first caller?

Our first caller is not that can.

Not that Karen, you have two minutes for public comment.

Please state your name for the record and proceed.

Hello.

Yes, ma'am.

Yes, Karen Winston here.

Um yeah, thank you for the the two minutes.

Um comment, public comment uh time.

Uh, we don't get two minutes too often.

We usually get 90 seconds, sometimes 60 seconds.

But thank you anyway.

And thank you for your punctuality, sir, because you were actually on time.

Thank you for that.

Um we uh we the city of Detroit retirees.

We uh we've been notified there's a fast track resolution that was been created on our behalf, but we don't need a resolution, we need action.

We need you know, we need to have our pensions restored, we need to have that cola restored, put back in into uh operation because we're having a hard time here with uh skyrocketing um you know inflation rate, and we're still at 2013 uh pension check.

We haven't gotten any you know anything with that 464 dollars, and that you know, needless to say is is nothing.

So yeah, I'm advocating that we do more than put us in the front of the line.

Or we stood in line when we punched the clock for 30 years.

We we've done we've been in line already long enough, so we we need our money to be restored.

Now I also like to advocate for the homeless and the children and the single parent mothers and or fathers that are out trying to make a way, you know, for the children because winter is coming.

We know winter is coming, so we need to do more uh do more rehabilitation and less uh demolition and try to make the situation right for um the less fortunate of us.

Uh yeah, and and the six hundred million dollar over taxation.

That's something you know that we know that that was done wrong as the bankruptcy was done wrong, and it needs to be made right.

Now, reparations come in all types of forms.

It doesn't have to be cash.

We can have uh months where or years where we don't pay property taxes, and then you know, stop all these abatements.

That'll make the difference.

Thank you.

Thank you.

Next caller, please.

Our next caller is Tyson Gersh.

Tyson Gersh, you have two minutes for public comment.

Please state your name for the record and proceed.

Hi, can you hear me?

Yes, sir.

Mr.

Gersh, are you there?

We just heard you.

Please restart his clock, Mr.

Payne.

Mr.

Gersh.

Are you there?

Okay, why don't we stick them to the end of the queue, Mr.

Payne?

Go to our next caller, we'll come back to him.

Mr.

Chair, our next caller is Cunningham.

Brother Cunningham, you have two minutes for public comment.

Please state your name for the record and proceed.

Brother Cunningham, are you there?

313, 444, 9114.

313, 444, 9114.

313, 444, 9114.

That number was made so you can remember it.

And on Facebook, not enemy.

Two words, not enemy.

And so last night at the night of the city council meeting.

And my energy was a little high.

Um, I was gonna go straight home to drop my sister off.

Thanks for being so nice to her, everyone at the meeting.

Um, and so I went over to the end of the line of the eight mile, the end of line of Grand River, and uh passed out my uh bus tickets and things, and a lady with seven kids living on the buses to stay warm, was getting off the bus.

And first thing I I grabbed 20 and 10 bus tickets and well proceeded to walk toward her, and then she stated that she was homeless, and someone's gonna put a room uh uh a room in their name because she didn't have any ID.

And I knew she was a Christian, and uh I knew she said she was crying and pleading to God all day, and um, so I took her to Victory Motel and I paid a portion of the room and put it in my name so the kids can have somewhere warm to lay down.

Um, I did refer her to Jason of Mary Waters' office, the Audible Councilwoman.

Uh, usually they um assist.

I gave them a low-income housing list.

I pray with them, and I know I'm not perfect, I'm very flawed, but the fervent effectual prayers of the righteous available much.

And lastly, there is a D dot meeting this Thursday.

Look it up on social media, put in Detroit Department of Transportation.

Share it.

Up Restline, share it, regular folks share peons like me.

Share it.

Thank you so much.

Thank you, kindly.

Thank you, Brother Cunningham.

Next caller, please.

Danielle Wansley, you have two minutes for public comment.

Please state your name for the record and proceed.

Yes, it's Daniel Vinesley.

I'm in the wrong zone.

I thought this was for the building and the dangerous buildings, so I just have to get them a call.

Okay, thank you.

Thank you.

Thank you.

And the chair recognizes member Santiago Romero.

Thank you, Mr.

Chair.

Um, ma'am, the dangerous buildings hearings.

If you're calling regarding that, um, that will be in our public health and safety standing committee on Monday, October 20th at 130 p.m.

If you need more information, you can feel free to call my office at 313-224-2450.

Uh, Vanessa can give you some more information.

Uh, but that is when I when we're gonna have our next dangerous buildings hearings.

Thank you, Mr.

Chair.

Thank you, Member Santiago Romero.

Next caller, please.

Our next caller is William M.

Davis.

Mr.

William M.

Davis, you have two minutes for public comment.

Please state your name for the record and proceed.

Uh, yes, could that be heard?

You may, sir.

Okay, I like to start off by saying I agree that the city of Detroit needs to do more to aid and assist the city of Detroit retirees.

Uh, we continue to suffer.

Uh, in fact, I retired in 2012.

What I get now is less than what I started with when I when I first retired.

It's you know, like $1,500 less a month.

I don't think any of y'all can live on $1,500 less than what you were making in 2012.

I very seriously doubt it.

Um, also, the city they take a call back from me and thousands of other city retirees, but yet we have a lot of uh projects to go on that do not meet their obligations and do not say and do not do all that they say they was gonna do, they don't call back anything from them.

I think that's unjust.

Um also I I think that the mayor needs to realize there's enough city deterrent retirees and their families and former co-workers to keep they could keep him from becoming governor because he's done a horrible job of doing stuff to aid and assist the city retirees.

You know, like said people keep sending me lists of his failures, and the list grows every day.

But I think that we need to be doing more to help city retirees.

I think we need to be doing more to help seniors in this city.

I think we need to be doing more just to help poor people because the the number of children in poverty has jumped.

You know, the city of Detroit population from the time the mayor took office to now.

You know, we went from the 16th largest city, the 18th, 16th, up to the 26th largest city.

You know, so a lot of stuff is dropped to get worse.

And uh the mayor can and should do a better job of helping the people who live in the city.

Thank you.

Thank you, Mr.

Davis.

If the clerk shall know, we've been joined by member vice chair Young.

Good afternoon, sir.

Clerk also note.

Thank you.

Next caller, please.

Phone number is in 124.

Number ending in 124.

You have two minutes for public comment.

Please state your name for the record and proceed.

Number ending in 124.

Are you there?

Hello, can you hear me now?

We can.

Please proceed.

Okay, great.

Thank you for two minutes.

I would like to commend Member Santiago Romero for being the one last night that uh seemed to be the one who actually watched the residents who were speaking while many of you were on your devices.

So thank you, Member Santiago Romero, for paying attention to the people like you were elected to do.

Um I see something.

I am also writing the city clerk about why it's hard to pull up the agenda and what that has the little paper clip so we can see what's on it.

It used to appear regularly.

I'd also like to make a complaint that you guys get a board packet that uh we frequently don't get.

So I don't think that's fair that you're reviewing a bunch of city documents that we don't get a chance to see.

Also, but what I do see is there's information about the Board of Zoning Appeals.

I don't understand that under charter section um 9-507.

It's quite clear.

Actually, I think there's a lot of corruption in the law department personally, because otherwise he wouldn't interfere with it.

Well, we have not been asking you to get into the merits of the BZA case that's pending.

But where did the $6.35 a page come from?

If you did, if council did not approve it, it's not legal.

And it isn't legal in the first place because council, the BZA is already required to have the transcript, whether anybody appeals or not per Detroit City Code 50-2-6-6.

So, Mr.

Graham, why don't you explain that to everybody?

And and also, you know, when you ask for explanations from the mayor's office, ask them to put it in writing and put it somewhere where you miss Warwick, Chair recognizes Member Santiago Romero.

Hi, Ms.

Warwick, good afternoon.

I just checked, and if you would like to follow along today, we do have an audits and the presentation is linked online.

If you go to Detroit Mi.gov, go to government, go to City Council.

The first tab is viewed city council meeting agenda.

You will see the cow of the calendar.

And if you go to today's 1 p.m.

BFA meeting for the 15th agenda, either PDF or um the HTML will come up.

I just opened the PDF and you do see the agenda for today and the PowerPoint if you wanted to follow along.

Thank you, Mr.

Chair.

Thank you, Member Santiago Romero for noting that.

Uh as is customary, uh, Ms.

Warwick.

Uh, that is for all of our committee meetings as well as formal session.

Next caller.

Mr.

Chair, coming back to Tyson Gersh.

Tyson Gersh, two minutes for public comment.

Please state your name for the record and proceed.

I can you hear me now?

Yes.

Okay, great.

Um, sorry, I don't know what happened earlier.

So regarding the BZA, the LPD report regarding Sheffield's memo about the fee schedule.

Um, I mean, I'm I don't want to, I don't know how to say this.

I'm trying to say it respectfully, but that the report is incorrect.

Um, I mean, you can read the resolution you from 2013 yourself.

Therefore, be it resolved.

The city, the Detroit City Council approves a 20% increase for the appeal fee schedule of the Board of Zoning Appeals to take immediate effect.

There is no reference, no discussion, no proposal, nothing about changing the uh transcript cost from a numeric amount to passing it through to the whatever the court reporter is charging.

Like to City Charter 9507 requires any change made to a service fee to be done only through city council authorization.

The 2013 schedule says on it, one the date on it is wrong, but it also says that it was corrected in 2019.

You know, in 2019, there was all those marijuana cases going before the BZA that ended up in the circuit court, uh, which had a ton of transcript obligations, all of which appear in the lower court records, the record of proceedings, you can see them.

Um, but it seems to me that the BZA just changed its fee schedule on its own initiative in 2019.

Uh the correction was the BZA just changing that language without city council authorization to try and avoid having to pay for a bunch of transcripts for these marijuana cases going to circuit court.

Um there's if city council approved it, there should be a clear record of that action.

And there is not.

Okay, thank you.

Mr.

Penn, does that conclude public comment?

Yes, that concludes public comment.

Thank you very much.

All right, we will move now into our 110 p.m.

discussion, a little bit behind on that.

Uh, we have Plant Moran and the Auditor General.

Our auditor general, Miss Laura Goodspeed is joining us today.

And I believe Plant Moran is joining us online.

So if we can promote them and grant them sharing capabilities, please.

Good afternoon, honorable city council members.

My name is Laura Goodspeed.

I'm the auditor general for the City of Detroit, Office of the Auditor General.

And it is with great pleasure to um bring to you one of the responsibilities as required by our office by the charter is to provide a report of our financial statements as soon after the close of our fiscal year.

And today, our external auditors, Plant Moran, will be providing to you the pre-audit meeting, uh, which is for our fiscal year ending June 30th, 2025.

And so with that, I'd like to turn it over to the members of Plant Moran.

Thank you very much.

Good afternoon.

We start with you if everyone can state their name for the record, please.

Absolutely.

Good afternoon, Ali Hajazi.

Good afternoon, Amanda Ward.

Good afternoon, Josh Edy.

Good afternoon, Sadie Maling.

Okay.

Thank you for the opportunity to meet with the BFA today.

Again, my name is Ali Hijazi.

I'm an engagement partner.

And here with me today is my partner Amanda Ward, as well as principal Sadie Maley and Josh Edy.

We're here today to walk through our plan for this year's external audit of the City of Detroit's financial statements and compliance with your major federal programs for the year ended June 30, 2025.

We've prepared a presentation today that was distributed with the meeting materials to help guide our discussion that Josh is sharing.

And really we'll begin by introducing our team, then we'll walk through our approach, our timeline, and key focus areas for this year's audit.

At the conclusion of our presentation, we'll be happy to take any questions that you may have regarding our approach or our presentation.

So here's a look at our audit team structure.

Each member that participates in the city's audit uh brings deep experience with governmental accounting and audit matters and a strong understanding of the issues that are relevant to the city's financial statements and major federal programs.

My role is as the engagement partner over the city's annual uh comprehensive financial report.

And Amanda will serve as the engagement partner over the city's single audit or its audit of this of the city's major federal programs.

And our roles are really to oversee the audit strategy and execution and ensure that the audit is carried out with appropriate quality and in accordance with all professional standards.

Josh and Sadie will serve as the principals on the ACFR and the single audit, respectively, and their roles are really to help manage the day-to-day audits, ensure we're being responsive and collaborative with the city team and ensuring we meet all reporting deadlines.

So with that foundation, I'll turn it over to Amanda to talk a bit more about our audit approach and our process.

Thanks, Ali.

Um, so one of the things you will notice is that our audit approach is really inherently collaborative, and we have four phases.

Our planning phase, we understand the internal controls and your environment so that we can make sure we plan our audit accordingly.

We go through our testing phase and then we certainly opine on our deliverables.

But throughout this process, collaboration is key, but also communication is key.

And we work with the various departments.

And what you will see on the next slide is that our audit approach is inherently collaborative and interdependent due to the city's broad operational scope.

We work with a number of agencies and must give consideration to all of the city's component unit to deliver the annual comprehensive financial report, the single audit report, as well as the financial, the separate financial statements for both DDOT and DWSD.

So we collaborate and coordinate closely across the teams to ensure that all of the audits are completed timely and accurately.

Related to our responsibilities, those remain unchanged from prior years.

Our responsibilities are under both generally accepted accounting principles and government auditing standards.

And we're responsible for appining on whether the financial statements are fairly presented in accordance with GAAP and related to the federal awards, opining on each major program as to whether the city has complied in all material respects with compliance requirements that could have a direct and material effect on each major program.

We also are responsible for communicating all instances of noncompliance with provisions with laws, regulations, contracts, and grants that have a direct and material effect on the financial statements, as well as reporting material instances of use, whether that's qualitatively or quantitatively, if they're identified during the audit process.

And I'll turn it back over to Ali to walk through the timing.

Thanks, Amanda.

So what this slide illustrates is uh really the the different phases of uh the audit engagements that Amanda had mentioned.

So generally, an audit has three phases a planning phase, a field work phase, uh, and then a reporting and wrap up phase.

And what this slide shows are those phases for each of the different components of the audits, which all have different start times based on when it makes sense to get started in that planning and risk assessment process.

But for all the audits, really the bulk of the year-end field work and testing occurs between September and November, uh, all working towards that plan to issue all of our deliverables by uh mid mid to late December and ahead of the deadline.

And then following the new year, we would uh return to BFA to uh provide an exit meeting with the results of our of our audits.

So, Amanda, uh, do you want to comment on the compliance supplement?

Is that relates to the single audit?

Sure.

Thanks, Ali.

So as of today, the Office of Management and Budget has not released the final 2025 um compliance supplement.

And because this supplement provides essential guidance for conducting single audits, including determining which compliance requirements must be tested, auditors are not permitted to issue single audit reports for fiscal years ending June 30, 2025 or later until the final version is published.

While we do have access to the draft version of the 25 compliance supplement, which we're using to guide our audit procedures and planning, we cannot um rely on our reports.

We can't rely on that draft version until the final is actually issued.

So because of that, we are working to issue the financial statements, the single audit and the other reports concurrently.

However, should that um 25 supplement not be issued, um, the single audit will need to be held until that final issuance um takes place.

Um, this actually occurred probably in 2019 or 20.

So this is not um something that's uncommon.

Um what we will do is work closely with the city to make sure that we can get this filed timely, hopefully, um, before the end of the calendar year, but certainly we'll keep you abreast um as we become aware of any changes.

Thanks, Amanda.

So on the next slide, um, as you you probably remember, there's a number of um separate legal entities which roll up into the city's uh financial statements, which all receive their own separate standalone audits.

And there's a variety of different audit firms that are involved in conducting uh those audits.

So an essential component of the city's annual comprehensive financial report is to make sure this information is received uh timely and we're able to apply our procedures to those reports in order to issue the city's annual comprehensive financial report uh by the deadline.

The city's team helps to track these work streams from these firms to ensure the necessary reporting is provided to the city timely.

So we also communicate with the auditors of those significant components to ensure that any areas of focus that are significant to the city's overall financial statements are addressed and their component audits.

And finally, once those audits are submitted, we review the results to ensure that any items that are material to the city's financial statements are properly presented and communicated to the city council.

With that, I'll turn it over to Sadie to spend a couple minutes on the single audit.

Thanks, Ali.

So we've mentioned the audit of the federal programs, and that's the federal money that the city is receiving.

We go through a risk assessment process as prescribed by the audit standards to determine which major programs or which of those programs that the city receives.

We will do additional audit procedures on, which includes gaining an understanding of the controls around compliance as well as compliance testing that Amanda referred to before.

So in for this year, um that that is a continuous process that risk assessment.

We we start with preliminary information and we um continue to work with the city until they finalize the schedule of expenditures of federal awards.

And so for this year, the preliminary major programs that we have worked through and started uh our testing on are listed here the coronavirus state and local fiscal recovery fund, um, the special supplemental nutrition program for WIC infants and children, WIC, home investment partnerships, and HIV emergency relief project grants.

So we are um, as I mentioned, working with the city to test through that.

Um and we are following that draft 2025 compliance supplement as Amanda um talked about.

We will need to, once the final compliance supplement is released, we'll need to do um some due diligence just to make sure that nothing's changed based on our uh audit approach and plan as it stands currently.

And I will turn it over for the next slide.

Thank you, Sadie.

So uh as part of every audit, we focus most of our energy on the areas we have identified with the most risk.

Uh a lot of these you would have seen last year.

So some of these will seem very familiar.

There are some new ones here as well, though.

Uh, the first item is management override of controls.

And that's always going to be a risk in every audit that we approach.

So we make sure we address that.

Uh, the second item is the revenues.

And the city has uh many sources of revenues, and the areas of heavy heavier focus include income taxes and funding related to grants and other arrangements.

The city also has several significant estimates, and you can see those listed here.

We'll be spending some additional time looking at those items.

Those include claims and judgment liabilities of variety of type uh allowances of uncollectible receivables, the pension liability, and then compensated absences.

And that last one does have a new accounting standard this year, which is GASB 101.

And what that is doing is changing the way that the city records and measures that accrual for that liability.

So we will be spending some extra time on that as well.

The second to last bullet point here is the overall authorization approval and payment of payroll, including overtime.

And then as Sadie said, risk assessment is a continuous process.

So any other significant risks that we identify through the course of the audit will also be things that we address.

So we will perform procedures and we'll have that in the pre-audit letter to specifically address the risks that we identified here.

Um we will be gaining an understanding of the internal controls of the city, but we will not be expressing an opinion on them.

And we'll be tailoring our work to emphasize areas that have a higher risk of material misstatement, uh, making sure that we are testing appropriately there.

The last slide here is really intended to provide you with an opportunity to raise any concerns or questions you have as members of the BFA committee, uh, whether that's in this meeting or subsequent to this meeting.

If anything comes up, we'd be happy to hear any feedback from you.

And with that, I'd like to open for any concerns or questions you may have.

Thank you.

Thank you.

Uh questions from members.

Chair recognizes member Santiago Romero.

Thank you, Mr.

Chair, through you to uh plant Moran.

Thank you for your auditing that you're going to do and for your work.

I have just a few brief questions.

Um, where we just left off that you are looking to gain an understanding of the city's internal controls, but you won't express an opinion.

Why not?

That seems like it would be helpful for us to know what your opinion is on this work.

Yeah, that's uh so um that is the standard requirement for the audits is that on the financial not issuing an uh an opinion over internal controls.

However, what we are doing is when we obtain an understanding of the internal controls, any deficiencies in internal controls, we are required to communicate, and we do that each year.

So we're uh always required and have in our final audit report.

So here are the deficiencies in internal controls that we've identified through getting that understanding.

Got it.

And I do remember um hearing those when we get reports.

I just um I guess that's information that can help us uh identify how to be more effective.

Um the authorization approval and payments of of payroll, including overtime.

Would you also think that this is a common problem as well?

For for governments, you know, the you're in the business of delivering services, and that requires you know, uh significant levels of uh personnel that across a variety of departments.

Um, and so it is an area of focus that is very typical in local governments, uh, just given the volume of uh employer compensation expense.

So it is something that would be pretty common as a focus area.

Okay, um, because you mentioned the first one as well.

So just trying to keep track of what are common things for us to um keep in mind.

Yes, I believe my oh you mentioned um B potentially not submitting their information on time.

Is there a consequence to this?

So OMB has the responsibility on an annual basis to issue the compliance supplement, which instructs auditors on what our tasks are and responsibilities are for the single audit.

Um there has been much communication from various associations, um, whether that's um your um NASAC, your AICPA, to let them know the hindrance that this is putting on communities, organizations to not have this released.

Um, but we are prohibited, unfortunately, from issuing our single audit until they release that.

Okay.

And my um final question, I believe for now.

Um, just to make sure that I am understanding this correctly.

For page seven, you will be reviewing the single audits and giving us essentially an overview, uh a summary of those, correct?

Did I understand that correctly?

Yeah, uh, and just to confirm slide seven is the slide that lists all of the different auditors.

Yes.

So we do for all of the not all of them have material activity, but for all the ones that have material activity, we are um reviewing all of the reports and making sure that anything that comes up in those reports is getting communicated if necessary under the standards.

Okay, thank you.

Thank you, Mr.

Chair.

Thank you.

Uh any questions.

Okay.

I would just say to you, uh, thank you for uh your work.

Uh really enjoyed a pre-meeting.

It is a good refresher as we are going into another audit uh season.

I see uh our auditor general is very happy about that.

Uh but um this will be interesting coming into this year.

Obviously, a lot of big things coming relative to ARPA, and we're getting to closer to 2026.

Uh a lot of a few compliance deadlines, uh, as well as we'll be on the cusp of a new administration, uh as well as new uh departmental processes uh may take place and then also budget.

Uh so uh we'll be very interested to see what this audit looks like uh once we get through with it.

Uh, but want to thank you again for your diligence as well as you, madam auditor general, uh, and for uh your work as well.

Uh I'll chime in, Mr.

Corley.

Do you have anything you'd like to say?

Okay, and I'll turn it back over to you, Madam Auditor General, for the final word.

Uh thank you through the chair, and I that concludes the plant moran presentation.

I do want to say for the sake of the public, while our office is charged with completing uh the external um audit, we do contract that out to plant moran in this case, but the contract is under our office.

Thank you.

Thank you.

All right.

Seeing no further questions, uh, we will now close out uh our discussion and receive and file this report uh submitted uh by plant moran.

Thank you all again uh for your participation and providing this information.

Thank you, Madam Uh, Auditor General.

Thank you.

Have a great you as well.

Thank you.

All right.

Now we will move uh into unfinished business.

There is none.

We will move directly into new business under the Office of Contract and Procurement Line Item 7.1 submitting a resolution of authorization for contract numbers 6005 276 dash a 3100 percent city funding, amendment three to provide an increase of funds for professional auditing services.

Contractor stout Reese is Ross, total contract amount $750,000, and this is for a $75,000 contract increase.

Motion to discuss line item 7.1 motion.

Thank you very much, Madam Auditor General.

If you can just give us a brief overview of this contract as this is coming through the auditor general's office.

Thank you.

Laura Goodspeed Auditor General.

The first two audits are being conducted by our internal team.

We outsourced the payroll audit to Stout.

We were in the process of finalizing uh our second and third reports as it relates to payroll.

We did publish a first interim report relating to a scope limitation for D dot payroll.

We were in the process of finalizing our um public safety reports as well as the remaining city agencies reports, and two things occurred.

We were requested to provide additional detail and discussion when we presented our draft report to the OCFO and to um the public safety departments.

We since provided them with detail, allowed them additional time to review the findings and observations and provide feedback.

That was the one thing.

The second theory reason for requesting this amendment is to allow our um auditors to investigate the allegations of payroll fraud within the Detroit Fire Department.

This was uh published on the news, and it was a publication in July of 2025.

We are required by our standards to investigate any subsequent events, even though even if our report had been published and this came out after that report, we are required by our standards to investigate any subsequent events.

So this additional funding is needed to allow Stout to continue investigating those allegations and to um just make sure that we follow up on those allegations as it relates to alleged payroll fraud fraud within the city of Detroit.

Okay.

Chair recognizes Member Santiago Romero.

Thank you, Mr.

Chair.

Through you uh good afternoon, um, Madam Auditor General.

Just quickly, do you have any information to share?

Um, would you happen to know how many hours were unaccounted for, or are you going to find that out through the auditing process?

Well, this uh I will say that this particular allegation was investigated by the Office of Inspector General as well.

Okay, and we have been working with them to look at other um alleged incidents.

Okay, we are hoping and to uh our goal was to publish the two reports by the end of this month.

So we're still looking at early November.

Um there have been some additional items that have come to surface regarding payroll, and so we again have to go back and do some additional work in this area.

Okay, got it.

Because I do have questions around if you know how many hours um when unaccounted for, would you happen to know how many hours?

Not offhand, but we can provide you with that uh investigation report.

Okay, and I believe it did list the hours and the amount of monies that was involved.

Okay, if you wouldn't mind, please.

Um, that way I'm brought up to speed because I am not on this issue.

Thank you.

Thank you, Mr.

Chair.

Thank you, Member Santiago Ramiro.

Any further questions?

Chair recognizes member vice chair young thank you.

I'm looking at this contract.

I don't know if this has anything to do with what we're talking about here today, but I'm uh stout Reese and Ross, and it's referring to a um all allegation about fraud.

And I just want to know one, do we know how long that process is gonna take?

And then secondly, is this process that we're doing now, is that something that will take care of that, or is that something that will be designed more within the forensic auditing side?

And would we contract that out, or would we deal with that in-house and what is the process of that?

Through the chair, uh I think I'm if I may try to answer your question.

As a part of this audit that is already contracted out to Stout, we are investigating not just this allegation, but looking back at the uh scope, and we've actually expanded what we're looking at to determine if there are any additional issues relating to payroll fraud or um abuses within the system.

A part of that is working very closely with our public safety departments, DPD and DFD, to determine uh what processes they may have put in place to uh mitigate this from happening in the future, and so that will be a part of our report, along with any additional recommendations that we may provide to the department to again mitigate this and to try to eliminate as best we can um this type of uh occurrences in the future.

And to you very quickly, Member Vice Department, to you, Madam Auditor General, just on that point, though, I know you gotta be very careful because there is an ongoing investigation about it, correct?

And we're currently auditing it, correct correct.

But the the one thing uh the IG, and I'm not sure what investigations are still currently because that's very confidential.

The work that they do really focus on a specific incident and verifying whether those allegations were correct or not.

And I believe the IG's report as it relates to this incident that was published is public.

What we do is go a step further.

We try to determine what is the root cause, what are the agencies doing to prevent this?

And given our expertise and and our uh understanding of processes and internal controls, we're in a position, we feel to make valuable recommendations to the city to those departments to again try to mitigate these occurrences uh from happening in the future.

Okay.

So the it's an answer your question, we can operate simultaneously, even though we're looking at the same types of occurrences.

That wasn't particularly my question.

I'm sorry to cut member vice chair off.

I I was just saying specifically just on details, just ensuring that if there is an ongoing investigation, obviously there are some details that have not may have not been revealed, particularly to council members, uh, which would generally probably come across us as privileged and confident confidential, depending uh on the nature of those and the actions that are possibly gonna be taken.

But I just wanted to ensure, you know, I just wanted to ask you, it's in the middle of that process from both IG and AG, but you're saying the IG has already submitted that report.

I believe for this particular uh for that particular incident.

Okay.

We're not revealing the black ops or anything like that today.

I just I I I I I yeah, yeah, no, I'm not I'm not I'm not trying to get you to do that today.

I just I just want to know just just what the process is for that, and I just also want to know because you have constituents that for time to time will come up here and talk about you know forensic auditing.

I just want to know what the process for that was, and does that and does something like this that we're talking about uh rise to the level of having that process take place, or is that extremely specified?

And and do you handle that, or does the IG handle that what's I just what's the process of that?

Well, our office, Office of the Auditor General again, works very closely with the Office of Inspector General.

To the extent that we find cases that uh imply criminality fraud, we would turn those over to the inspector general for investigation.

Okay and then they would determine whether or not the um forensic audited pro what what what auditing measure would be required in order to best find out or root out that fraudulent behavior, correct?

Uh through the chair.

So the term forensic audit, we it's it's a subset of the work that we're already doing.

Okay.

So is there something back through transactions?

Yeah.

We're looking at all of those details.

Um is there something I'm missing?

I mean am I getting words confused here or or is it just is it such a specified process you don't really use it a whole lot?

We do.

The in fact the firm that we uh outsources to stout has uh several forensic auditors on staff.

Typically, when you go out for a forensic audit, it is a specific um item that you're looking for.

Okay, and those forensic auditors often end up in court um on these types of cases.

Right.

So we have uh again employed them, but for us, if we find any instances of criminality, our charter is to work with the inspector general, because that's the city's kind of forensic auditors that we have in the city.

Yes.

Thank you, Mayor.

Thank you, ma'am.

Thank you, Mr.

Chair.

Thank you, Member Vice Chair, and thank you, Madam Auditor General.

Uh, for all your diligence as always.

Uh colleagues, is there a motion to send line item 7.1 to formal with a recommendation to approve?

Here are no objections.

That action shall be taken.

Thank you, Madam Auditor General.

Next, under the Office of the City Clerk's last city planning commission line item 7.2 submitting a resolution of authorization for neighborhood enterprise zone certificate applications for 96 newly built condominium units within the new Hudson's Tower with the Roscoe Development Company L C Neighborhood Enterprise Zone.

This has been recommended for approval by the CPC.

And again, this is for 96 applications requesting an NEZ certificate for 96 new condominiums built within the new Hudson's Tower.

Motion to discuss line item 7.2.

Motion.

If you can run Mr.

Chair, uh Chris Gulak, CPC staff.

We are very familiar with this project.

If you can run this, uh run this, run us through this uh quickly and show us your presentation.

Mr.

Chair, I believe we're also joined by Brian Watkins from uh Bedrock.

He's in the audience, uh Zoom audience.

Okay.

We can promote Mr.

Brian Watkins from Bedrock.

I'm having some trouble with my camera, but we're working on it right now.

Greetings to you and the members of the committee.

Great to see you as well, even though we can't see you, but we know we know what you look like.

Um we can proceed, uh Mr.

Goulat.

Thank you, Mr.

Chair.

Uh yes, I have a brief uh PowerPoint overview.

Uh, this is at 1208 Woodward, the Hudson's Tower.

Next slide, please.

And this is located in downtown, shown on as the red dot on the east side of Woodward.

Next slide, please.

And as the committee knows there's uh two towers being constructed, and um it's on the east side of Woodward between Grand River and State Street.

Next slide, please.

This shows a elevations of the uh Hudson's Tower.

Uh next slide, please.

And the name of this NEZ is unique.

It's Roscoe Development Company LLC, which council approved back in November of 2017.

Uh the petition for these uh certificates is Woodward Avenue condominium LLC, which is an affiliate of 1208 Woodward LLC and Bedrock.

Next slide, please.

The proposal uh before City Council for consideration is a request for 98 uh any of these certificates for 98 new condominium units, and they would be located on floors 26 through 45 of the taller Hudson's Tower.

The units would have a variety of sizes, but the average size of each um condo would be about 1,667 square feet.

Uh next slide, please the following this is in our report as well as a breakdown of the different bedroom types.

There's 14 one bedroom, 56 two bedroom, 21 three bedroom, and five four bedroom for a total of 96 uh new condominiums.

Next slide, please.

Uh regarding the price, uh bedrock is estimated to be about a thousand dollars per square foot, but it really depends on the size of the units.

Um regarding affordability, um Bedrock, Bedrock's current affordable affordable housing agreement with the city commits to 20 percent rental units in the bedrock portfolio uh be at 80 percent or below.

The council may recall, I believe in 2022 bedrock struck an enhanced affordable housing payment with the city that will require 30 percent of the rental units in bedrock's portfolio portfolio as affordable with rent um 60 percent AMI or below.

So the affordability doesn't apply to the Hudson's Tower specifically because they're for sale units, but it does apply to uh Bedrock's portfolio moving forward.

And the last bullet here is Bedrock indicated that the enhanced 30% to 60% AMI commitment becomes effective when council approves the Hudson PA 210, which council approved in 2022.

And then when council approves the NAZ certificates, which is before you today.

Next slide, please.

Regarding party regarding parking, each residential unit will have a dedicated parking spaces in the uh Hudson's Tower underground parking structure.

Regarding accessibility, uh they do indicate there will be um ADA designated units.

So there'll be a minimum of two of the 96.

Uh, but but Bedrock did indicate um that uh in addition to those designated units, all the units could be adapted uh uh for built-in and future accessibility modifications based on a purchaser's request.

Um and last bullet on this slide is that the building is ex uh has required accessibility features throughout the building, um, including the parking spaces, uh pedestal mounted ADA door actuators and and ADA compliant pool lift.

And the ADA units in in the units uh will have uh accessible laundry facilities as well.

Uh next slide, please.

So in conclusion, uh staff submitted report for your review and consideration.

We confirmed it is in the Roscoe NEZ approved by council.

Uh staff was recommending approval and the resolution is included in our report for your consideration.

Thank you, Mr.

Chair.

I can try to answer any questions or turn it over to Mr.

Watkins if he wants to add.

Thank you.

Thank you, Mr.

Gulag.

Uh, we've been dealing with this for a long time.

We've come to another portion of this piece, and this is an important piece to help push forward the affordability component of other projects that exist through bedrock due to the agreement from uh council at the time of passing this.

Uh any questions from members?

Chair recognizes member Santiago Romero.

Um I might be doing my math wrong, but just for for clarity.

Um if it's a thousand dollars per square foot, the average size is one thousand six hundred and sixty-seven.

Are we looking at an average price of a million dollars to purchase?

Well, if that's uh directed at us, thank you first of all for your question, Member Santiago Romero.

So yes, uh, I want to be able to clearly define the fact that um we are looking at housing in our portfolio for everyone.

Uh person doesn't have to go to New York or Chicago or Atlanta to find uh housing of this type.

One of the things that allows us to be able to do this is our affordability commitment to I'll say most of our inventory, meaning we're going to provide 30% of our inventory at 60% below AMI.

Uh, and that right now, today, today, as of this particular hearing, we're well over that.

We have 42%.

So uh it shows our reinforces our commitment to provide housing for everyone that wants to come to the city of Detroit.

I think you I understand exactly what you're doing.

I'm just confirming um because this just is what it is.

And you said 30 to 40, that about 42 percent of your inventory is at 60 percent AMI.

Um would you mind sharing that inventory with us?

Yeah, and our our total number of units right now is roughly 1,600 units.

1600, and then at 60, um, are we looking at 1200, 1300 a month?

Yeah, if you did if you did the calculations, you're looking at basically 708 of our units would be at 700 or so would be at 60 percent AMI or below.

Correct.

And would you happen to know what that monthly uh rent would equate to if it's 60 percent?

Yeah, I think we can get that, remember Santiago Romero.

Okay, thank you.

Um I might be wrong, but I'm thinking it's around 1200, 1500.

Um, but I I don't know.

Uh so that would be very helpful.

Um thank you, Mr.

Chair.

Thank you, Member Santiago Romero.

Chair recognizes member vice chair.

Yes, thank you.

I appreciate that.

Good to see everybody here again.

Well, I guess it was good.

I can see you guys.

I just wanted to ask you, um, kind of piggyback on the question.

Do you have it broken down in terms of how many units you have?

I know you say below 60%.

Do you have you know how many units you have at 50% AMI?

Do you know how many units you have at 30% AMI?

Do you have that kind of broken down in terms of you know what that overall portfolio looks like?

Certainly to through the chair to memory.

Absolutely, that's something that we can provide to this council.

I know that the total number is rough, roughly over 700 units that are under that threshold, and that's something that we do provide in our reporting.

And exactly, I just wanted to ask you, uh, this is more of a hypothetical here, but I just wanted to ask if if if there were more density bonuses that were provided, do you think they would be able to increase the amount of um affordable housing that would be in your portfolio?

I think first of all, thank you for the question through you uh through Mr.

Chair, to you member.

Yeah, I think one one of the things that that we have looked at is being able to uh to really increase that affordability, increase the level of housing that's available in the city of Detroit.

And that's not just you know, at the 60% level, but between 60, 60 to 80, 80 to 100, 100 to 120.

Um, we want all kinds of people to be able to enjoy our city.

But we don't want we don't want anyone to go to any other city to try and get a level of housing and say that is not afforded us here in Detroit.

So to your question, yes, I think there's some things that can be done uh to be able to increase that, not only from us but from everyone, every developer that's in the city of Detroit to be able to solve the problem of of more affordable units.

So definitely, definitely we look to be able to do that.

No, I think that's a real good thing.

I think that's important because I think a lot of I think that's one of the things we definitely wanted to approve on is making sure that we have more density and more density bonuses to be able to uh complete that.

I also just wanted to ask you uh finally, I just want to ask you is is there any plans on using any sort of technology, you know, in terms of 3D printing or things that nature that Rocket would have.

I know there's been some other companies around the country that have partnered up with 3D printing companies like Alquist and other words, I think it was Luxor and Alquest, but other housing developers that have partnered up with that to build those sort of neighborhoods.

Have you had any discussions about that at all?

Do we look forward to see that in the future, those type of partnerships?

It's interesting.

Uh through uh uh Mr.

Chair, to you, Member Young.

Um, I I'd have to check to see if we'd have looked in and into technologies like that, but it's a very interesting concept, and it's something that definitely sounds like is if it's happening around the country, we definitely want to look at it here in the city of Detroit as well.

And and if I could, um, I just wanted to piggyback on that, and I wanted to um to answer the question from Member Santiago Romero, and that is uh that level at 60% AMI would be uh for one person 1,060, 1,200 for a two-person and for three people would be $1,300.

So you were just about correct.

Uh okay.

Yeah, I just thought it'd be a better way in terms, I thought it'd be cheaper, you'd be able to produce more houses as well.

And so I think not only can we have more housing in the city of Detroit, we can have those houses produced at cheaper price.

We're using technology as well, and we can really deal with the issue in terms of uh deal with the affordability and the uh housing crisis that we're currently dealing with in the city of Detroit.

So thank you for that.

Appreciate it.

Indeed.

Thank you, Member Young.

Thank you, Member Vice Chair, and I I would say as we talk about the affordability, uh, and you look at it, uh you talk about 1060, 1200, 1300, we'll give uh residents an opportunity here in the city to live in one of the brand uh one of our brand new buildings uh here in the city.

Uh and obviously to look at the other side of the scale, having the ability to sell some of these at market rate because we do need diversity in the market to be able to subsidize affordability here in the city of Detroit is also equally important.

Um that being said, is there a motion to send line item 7.2 to formal with a recommendation to approve?

Motion hearing no objections, that action shall be taken.

Thank you very much, Mr.

Watkins.

Thank you, Mr.

Gulak.

Thank you, members of the committee.

Thank you, Mr.

Chair.

Next under legislative policy division line item 7.3 submitting a report relative to BZA questions.

Uh this is from Council President Mary Sheffield.

She has requested LPD provide answers to the following questions regarding the fee schedule for BZA appeals.

Motion to discuss line item 7.3.

Motion.

Thank you, member vice chair.

Do you, Mr.

Corley, do we need some time on it?

Or Ms.

Oh, good afternoon.

Good afternoon, attorney Phil Keller, LPD.

Uh to the chair, uh, would just first like to say that these questions were proposed by an individual who's an active litigation with the city.

So in concurrence with the law department, I think we like to keep um discussion relatively limited.

Um that and that's because the court, to the extent that uh uh remedy is appropriate, it's really in the court's hands at this point, and city council doesn't have the ability to provide uh similar remedy.

Um but that being said, um, as we previously stated in uh in a prior report, the BZA fees are very high.

And while that's not necessarily uh a legal issue, so long as it operates as a fee.

Um that in combination with other issues that individuals have raised about um difficulty accessing information from the BZA.

There may need to be some exploration into ways to increase accessibility and transparency uh at the BZA.

Um, but with regard to to this report, uh we requested documentation from the clerk's office.

Uh they provided us with the historical fee schedules.

So the schedules from 1981, 1983, 1988, 2002, and 2006 all had a set um price per page for transcripts.

The uh court reporter per page cost appeared on the November 7th, 2013.

Um, so the 2013 approved uh fee schedule, and then the most recent change that council made was in February 13th of 2024, which also included the court reporter cost per page, and that's where it stands today.

Thank you.

Through the Chair Krem Anderson Law Department, I'd just like to echo and reiterate everything attorney collar said in regards to litigation.

Thank you.

Thank you.

And through you, I I don't anticipate we'll be having a closed session on this.

Times, you know, days are winding down, but I'm sure you will submit some information to us that may be privileged and confidential uh if there are any questions, further questions.

Chair recognizes member vice chair young.

Even though uh chair was stole my thunder here a little bit.

I just wanted to ask just for reiteration.

Are are are you telling me one we're not gonna have a closed test and all this?

Because that's kind of usually where these things tend to go.

So you are you say you just don't anticipate it, or are you saying we're not gonna have one?

Through the chair, due to the logistics and the tight deadline as we approach the end uh of uh um the uh legislative term.

I would be surprised if we were able to fit one in.

Okay.

And the uh Mr.

Thank you, Mr.

Harrison.

Mr.

Keller, I wanted to ask you, sir.

Um you talked about the historical uh schedules earlier.

Are you saying that the fees that we're charging now are do they do they uh coincide they match historically what we charge, or are they higher and it's part of that c just because the cost doing business, or is that because of the inflationary times that we see ourselves in now and those costs rising reflect that inflationary increase?

Yes, to through the chair to member young.

The so the the transcript fee used to be a set price per page, and in 2013 it changed to the court report cost per page, which if you think about it operating as a fee that actually makes a lot more sense than having it as a set price because a a fee is just supposed to be a way for the city to recoup its cost, so whatever we pay is what we charge.

For the services provided, yeah.

Okay, and so basically you say that what's happening now, which is basically is basically the same the operator way which a fee is supposed to operate.

He's probably higher price, but the reason why they're paying them is for the services that are being provided, correct?

That's correct.

Okay.

Thank you.

Thank you, Chair.

Thank you, Member Vice Chair.

Okay, seeing no further questions.

Is there a motion?

Uh let me ask very quickly how we submitted this correspondence to council president's office as well.

Uh yes, we have.

Okay.

Is there a motion to receive a file line item 7.3?

Motion.

Here are no objections.

That action shall be taken.

Thank you.

Okay, members, we're at the end of our agenda, but we do have one walk on that failed to make it to this committee, should have been in this committee, but was referred to PED.

Uh, and this walk on is regarding a pilot uh for 3416 through 3422 Cochrane.

Uh is there a motion to walk this item on and the clerk shall know it will be labeled as line item 7.4.

So no.

Thank you.

Uh there's a motion to walk on this item to new business as line item 7.4 here.

No objections, that action shall be taken.

Now is there a motion to discuss line item 7.4, which is our walk-on.

Motion.

Thank you.

Uh joining us, we have Mr.

Cook.

Uh, and just for transparency sake for the public, this is for a pilot payment in lieu of taxes regarding three for one six through three four twenty-two uh Cochrane Street uh from CNS Towns Development LLC.

This is for a again a payment in lieu of taxes.

This project includes four town home condominium units and the Sycamore development area.

Uh and these are all for restricted units.

AMI.

New construction for this tax year.

And we are already discussing this.

If you both can introduce yourselves for the record, uh, and then just give us a brief overview of this pilot.

Justice Cook, Housing and Revitalization Department, Tax Incentive Manager.

Excuse your your mic.

I'm sorry.

Hi, Michelle Oberholzer Zimmerman, Housing Revitalization Department.

I'm doing uh program and policy advising work.

Okay, thank you.

Whoever would like to go first, please proceed.

Thank you.

To the chair of CNS Town Homes Development LLC is the owner of the development known as 3416-3422 Cochran.

The development has applied for the City of Detroit expanded payment in lieu of tax pilot program implemented pursuant to chapter 44-4-112.

The development is a workforce housing project as defined by the pilot ordinance, meaning the average affordability restriction proposed for the development are between 81 through 120% of the area medium income, AMR, because the project is workforce housing project and does not involve the rehabilitation of a structure that has been continuously vacant for 60 months.

The property owners required to obtain the approval of the housing and revitalization department, HRD, and the city council before it can receive a pilot.

The project includes four townhomes, condominium units in the Sycamore Park development.

Under the proposed pilot, all four units will be restricted, subject to rents and income and restriction averaging 120% of the AMI.

The restricted units includes four two bedroom units.

This is a new construction representing a total investment of 896,000.

The project is completed construction and pre-leasing at this time and is seeking pilot to go in effect for the 2026 tax year.

HRD had reviewed the property owner's pilot application and has issued its conditional approval.

The HRD underwriting team has reviewed the project financing and has determined a proposed pilot rate of 7%.

The project is also in district six and it's seeking the first council standard workforce housing project approval under the expanded pilot ordinance.

And I would like to pass it off to Michelle Oberhouse.

Thank you.

So that was a lot of background on the project itself.

Just some uh context for why we are bringing it to council and at this time.

So um as was written in the ordinance uh authorizing the expanded pilot projects that are workforce housing above 80 percent AMI do require council approval.

This is new construction, so it doesn't bypass that requirement.

Um and the rate was not prescribed either, so through underwriting, we determined a rate of seven percent would be appropriate.

And so we would need council both to approve this for pilot and to approve the rate.

I mean it's one resolution, but it contains those details.

And the timing is significant because they are seeking pilot for the 2026 tax year, they're required by the state legislation to submit uh to our sessor by November 1st, their MSH certified exemption.

So with council approval, affordability agreement execution, mission exemption.

That is why we're coming to you now.

We only just conditionally approved it last week, and now we're uh going to be seeking a waiver if council seeks to pursue this.

Thank you.

Uh good to see the components of the ordinance working.

I know a guy that was pushing that ordinance.

Uh uh, and this was the trade-off for council approval, but it's still uh for anything that was above 80 percent AMI, and then it's kind of a good exercise, I guess.

Uh, I'm glad I got a chance to do this one before I'm not gonna be on here, but to see that kick in uh that allows for that council approval and council to weigh in.

We haven't seen many pilots come uh in front of this committee because most of them have been under that threshold.

Uh actually all of them except for this one.

So uh very good to see this process working.

Uh that's my two cents uh about it.

Uh members, are there any questions just relative to this pilot?

Chair recognizes member Santiago Romero.

Thank you, Mr.

Chair.

Um, through you, good afternoon.

I'm this isn't district sixes in our in North Corktown, and I'm hearing a lot of pushback from residents in North Corktown about the new builds that are incredibly expensive, and they are gentrifying the neighborhood.

Um residents in Corktown, North Corktown.

Um, many of them are at the 30% AMI.

And um looking at other projects of this kind in this neighborhood, um they're being sold out these new condominiums town homes at 300 to 400,000 dollars.

Any idea how much uh it would be for this project?

The the monthly rent?

Sorry, I don't know it.

I don't have it up.

I'm so sorry I don't have it up, and we'll provide it.

Okay.

Um because I'm just and I I feel like I say this every few months.

Um when I see more and more approvals of projects that are 80% and higher.

I'm thinking about okay, where are we at the 30 to 60 percent AMI where we really desperately need people to be living and have safe places to live at?

Um, which is why I think myself, and I know member Johnson's asking this too.

What are the full projects that we have coming on the pipelines for us to see what how we're meeting all these goals?

So I guess I wouldn't mind the reminder of that of where we are, what HRD is doing because this is going to upset some of my residents because it's incredibly expensive still, and it's new builds, it's gonna be expensive.

Um, and they're just trying to make sure that seniors in their neighborhoods have a roof over their heads because it's an old home that needs home repairs.

Um so I guess I sell that to say is can HIG send us um what we're thinking about projects coming down the pipeline that are at the 30 to 60 percent AMI.

Um, and we need to be having these conversations at the same time.

Um, because I'm I'm I'm sure there are many people that are excited that we have one million dollar condos downtown that people can buy now.

But I'm still very, very much concerned about residents not being able to afford rent um and making sure that we're building for everyone, actually, everyone, including those that are making less less less than 60% AMI.

So that's my notes um for this, and um would like to have further conversations.

I won't stop this um from moving forward, if anything, while it goes to committee.

Would be nice to have that conversation with my team for us to get a better understanding of what's coming down the pipeline.

I know there are more projects coming, affordable projects in Corktown, um, but I'm also just beginning to to see a large number, a large number of at markets, workforce, housing, and we're still I'm still missing the 30 to 60 percent that I want us to to look at and talk about.

Um, but those are my comments and my my request.

Um we can move this forward and we'll see what I decide during formal session.

Um, but I'm not gonna stop this.

I I want to have more conversations.

Um thank you, Mr.

Chair.

Thank you, Member Santiago Romero.

Chair recognizes member vice chair.

Yeah.

Well, I'm uh I'm looking to kind of not to answer the question, but just to kind of set my question up here.

I'm looking at the 80% um the price for rent here, and it's saying that for 80% for three people, because that's usually I think the average household Detroit is uh single mother or two kids.

It's uh 1,414, and then for 120, I think it's 2,121, which brings up my question.

You say the workforce.

Who exactly are these houses being built for?

Do we have an idea of what kind of workforce they're in?

Are we talking about people who are uh working in the plant?

We talk about people who are in the construction or the trades.

What do we talk about exactly in terms of what workforce we talk about where living in these places?

Through the chair, I do not know the the trade per se that is referred to with that term workforce, but that is a defined term that refers to not low income, and it is something I believe that council's been intentional about the so-called missing middle and providing um in our policies, not only for low income while prioritizing low-income housing, but still providing for the middle ground.

And um, I do want to clarify that this exists and it is in pre-leasing.

It's not whether or not this will uh be housing, but rather will it have any restriction or at all?

And uh that is the decision before council.

Um yeah, yeah.

But I I don't have a problem with this type of housing, like you said, you need missing middle, you need upper class, you need all of that.

You know, because you want to have a diversity of tax just in terms of tax revenue.

So I I I'm not for it.

I for me it's just more about placement.

I understand this is one of the more thriving areas in you know in the city of Detroit.

But I've had conversations with people in North Corktown at Corktown, too.

And they have told me very specifically about some of the issues that they have about you know these houses being built and the people that are coming in, the people who can't afford these type of houses.

So I think that's a legitimate concern.

I think there's about 18 acres, if I'm not mistaken, that is vacant in the city of Detroit now.

Is uh are those properties available for us to be able to develop on, or are they not the most marketable properties to develop on at all?

That's one of the reasons why you can't do that.

To the chair through member council member Young.

Um a lot of developments we are seeing are long-term and short-term vacant rehabs to structures that are already currently existing.

And developers are going in there and rehabbing it and coming back for a pilot application because it's more financial feasible for them to turn that key over rather than do a new construction, which is um incredibly high right now.

Okay, so yeah, because if inflationary costs and things that dangerous easier for them just to be able to do the rehab.

Okay.

Okay.

All right.

I mean, you know, if if if my colleague doesn't have a problem for this, I'll, you know, I'm not I'm not gonna, you know, spit people's soup here.

Well, well, if you're gonna approve it, excuse me.

I'm not gonna I'm not gonna be the guy to spit in somebody's soup here.

I just want to make sure that we're doing all we can to understand the situation that's here and also understand that because we could have we could have high-aid housing.

We can have middle class housing.

I just think there's a balance that I'll try to achieve.

And I think sometimes, you know, because we haven't had this type of development in so long, and you want to keep it going, you want to pride that pup as long as you can.

You know, sometimes we kind of forget about having that balance.

And so I just want to make sure, and I'll show you probably have that, and I have to probably talk to you afterwards about that.

But I just want to make sure what are we doing to keep that balance where we can protect, where we can have these type of neighborhoods, and we can have thriving neighborhoods, but at the same time, we also do something for the people who stayed as well.

I'll do that.

Thank you.

Thank you, Member Vice Chair.

And I would just note uh on top of that, uh, again, we are talking about workforce housing.

So when we are talking about the missing middle, there are folks who work here in the city of Detroit who have families uh who don't qualify for anything below that because they make too much and get knocked out of that range.

So then they're forced to look for housing otherwise uh other places, and it becomes very difficult.

So the diversity in housing is very important, and I think it's also important to note that even in North Corktown, one of the biggest issues that they face now is abatement cliffs on projects which have high affordable housing components or have been given tax abatements as well.

So when you talk about diversifying that market in that area, you're gonna need some market rate to have again, as we talked about in the last line item, the ability to pay for the subsidies that will be provided or introduced uh to balance it out.

What uh what I will say uh in having conversations with folks in Corktown as well, that is always uh a concern uh in that area as we've seen it grow and have seen it grow exponentially uh over the past uh few years or past decade, should I say.

Uh, but again, what I would say is uh where do folks go uh if you are in that middle, are you stuck?

You you make too much to qualify for the programs that the city has, but you still don't make enough to feel like you're getting by.

And I think uh when you talk about providing tools for those folks who go to work every day, and some of those are our teachers, our doctors, our nerds, well, not our doctors, but our nurses, uh paraprofessionals, uh they need the ability to have a place to live as well and enjoy Detroit just as everyone else.

Um make another comment, please.

Um, to the chair and through the chair, I do want to make sure that you're all aware that the HRD is required to publish our approvals, and we do so weekly.

So Detroit MI.gov forward slash pilot is where the approvals are listed, and you will see we have nearly 3,000 units approved.

The vast majority of those are low income, and um, you won't be able to see it on a specific unit basis because it's based on the average.

So you'll see, for example, up to 60%, 61 to 80, and 81 to 120.

Um, and we have deeper data that we can provide up and would be happy to do so.

But um, your ordinance is working very well to to provide for that, and uh we we appreciate it.

Thank you.

And what I would say again, there used to be a time that every uh few weeks or every every Wednesday we would be approving pilots here.

Uh and now what we are seeing is we don't see that as much.

We're seeing that now uh because again, that threshold that's letting you know that the pilots that we don't see that are getting pushed through, they fall below this rate.

So I think that is also a testament to how much of affordable housing under the pilot, at least specifically, is being pushed forward.

Um that being said, uh, is there a motion to send this item to formal uh with a recommendation to approve?

Motion.

Hearing no objections, that action shall be taken.

Thank you very much.

Uh yes.

Does that include a waiver?

Must it include a waiver at this time or is that done before the council?

The waiver will have to be done at formal.

I would be prepared though.

This will what I will say.

I will be prepared to have that information from Member Santiago Romero on Tuesday.

Uh, because if one member objects to a waiver, that will not happen.

And I know time is of the essence for this because it does have to go from Mr.

being the guy that came from MISHTA.

Uh you're in that sweet spot right now and in this month.

So uh, but I I would uh hope that you guys can provide that information to Member Santiago Romero by Tuesday.

We'll do.

All right, thank you.

I appreciate the asking.

All right.

That brings us to the end of our agenda.

We go directly into member reports.

Chair recognizes Member Santiago Romero.

Negative report.

Thank you, Member Santiago Romero.

Chair recognizes member vice chair young.

Thank you, Mr.

Chair.

Uh I am having a hope program virtual meeting.

Hope me the homeowners property exhibition program.

The deadline is November 7th.

The Hope Deadline is November 7th.

That is the homeowners property exhibition program.

Deadline is November the 7th.

I am having a Hope Program Virtual Meeting with Eric Sabri, Wade County Treasurer, and Willie Dodwell, Board of Tax Review.

Wednesday, October 22nd, 5 to 6 p.m.

That's uh Wednesday, October 22nd, 5 to 6 p.m.

with Eric Sabree, Wade County Treasurer, and Willie Dodwell, Director of Board of Tax Review.

We are having a Hope Program Virtual Meeting.

So again, Wednesday, October 22nd, 5 to 6 p.m.

You can call 313-224-4248.

That's 313-224-4248.

That's 3132448.

The joint me for Hope Program Virtual Meeting.

Wednesday, October 22nd, 5 p.m.

to 6 p.m.

Eric Zabri, Wade County Treasurer, Willie Donwell, Director of Board Tax Review.

The Hope Deadline is November 2nd, November the 7th.

And it's Wednesday, October 22nd, 5 to 6 p.m.

313, 224, 4248 is double the call.

The Hope Deadline, November 7th.

Thank you, Mr.

Chair.

Thank you, Member Vice Chair.

And seeing no other business to come before this committee, the budget finance and audit standard committee will stand adjourned without objection.