|Detroit’s casinos will give $100 million to the city to wipe out its deficit as part of a deal to be announced today, according to sources close to the negotiations.|
In return, Detroit will allow the three casinos to reduce the agreed number of hotel rooms to be built, and will drop a requirement that they contribute over $60 million towards minority business development loans, this according to the Detroit Free Press.
Under the existing development agreement, the casinos were to contribute $63.5 million toward minority business development. But those contributions -- $50 million from MGM Grand Detroit, $11.5 million from the MotorCity Casino and $2 million from the Greektown Casino – are no longer required.
Sources close to the negotiations say that the casino companies will be allowed to build 400 room hotels rather than the originally promised 800 rooms, which will save on construction and operating costs.
Other key elements of the deal are that MotorCity and Greektown would expand where their temporary casinos are now, while MGM Grand would move to an as-yet-unnamed site of its choosing downtown.
Mayor Kwame Kilpatrick and casino officials are to announce the revised terms for permanent casinos today, but the agreement won't be ratified for at least another 30 days.
Licenses were granted for Greektown, MotorCity and MGM Grand casinos in 1997, but the legality of this was challenged by the Lac Vieux Desert Band of Lake Superior Chippewa Indians in the US District Court in Grand Rapids. This complaint was thrown out by Federal Judge Robert Holmes Bell in 1997, but the 6th US Circuit Court of Appeals in Cincinnati overruled Bell, and declared the three casino licences illegitimate and the tribe entitled to a remedy.