Magna official urges halt to investments after Troy votes down transit center

From The Detroit News

Troy faced quick fallout Tuesday after scrapping plans for a federally funded transit center, as an official with a local auto supplier said he would urge the company to look elsewhere for future investment.

Frank W. Ervin III, manager of government affairs for Magna International Inc., made the comment in an email Tuesday to the president of the Troy Chamber of Commerce, Michele Hodges. In the private message to Hodges, Ervin called the city’s leaders “narrow-minded when it comes to the future of Troy and the future of Southeastern Michigan” for rejecting $8.4 million in federal aid.

In the email, Ervin thanked the chamber president for her efforts to win approval for the transit center and said he plans to draft a memo to all Magna group presidents and corporate executives “strongly recommending” that the automotive supplier “no longer consider the City of Troy for future site considerations, expansions or new job creation.”

In a telephone interview Tuesday with The Detroit News, Ervin stressed that the email to Hodges was his personal opinion. He said he will make the recommendations, but has no authority to make the decisions. Magna’s U.S. headquarters is in Troy, where the company employs about 1,000 people at several facilities.

Tracy Fuerst, director of corporate communications for Magna, said the company is taking no position on the city’s decision.

Hodges said City Council’s decision late Monday to turn down the project is leading to pushback from the business community, which was outspoken in its support for the plan to combine train, bus, taxi and future light-rail service at a 3-acre site near Maple and Coolidge.

“We are already experiencing some fallout and disinvestment in Troy, and we need to preclude that from happening,” Hodges said Tuesday in an interview. “There’s clearly disappointment on the part of the business community. Its desire, will and recommendation was not met.”

Troy Mayor Janice Daniels, who voted against the transit center, said Tuesday that she didn’t see the email from Ervin to Hodges. The mayor said she has received “nothing but congratulations and accolades” for the city’s decision.

“I think it would be counterproductive to not look for other ways to help the city of Troy continue to be a vibrant city of leadership,” she said. “I would like for Troy to be a leadership city to encourage all cities in the surrounding area to decline debt money from the federal government.

“We need to recover the economy before we take on additional debt money. It doesn’t make sense to me.”

State transportation officials have said the federal funds would be reallocated to another rail project — possibly in another state — if they were turned down by Troy.

On Tuesday, Gov. Rick Snyder’s office expressed its dismay at the city’s action in a statement provided by the state Department of Transportation.

“The governor is disappointed with the Troy City Council’s rejection of the federal grant to design and build a rail station in Troy. The station is a key destination along the new high-speed rail line and to connect with routes for regional transit,” the statement said. “We are reviewing our options for utilizing the grant, including the potential transfer of the grant to another applicant.”

U.S. Rep. Gary Peters, D-Bloomfield Township, wrote Tuesday to Snyder and U.S. Transportation Secretary Ray LaHood in hopes of keeping the federal aid in Metro Detroit. Peters suggested building a transit facility in Royal Oak as a possibility.

“We’ll do what we can to make sure the federal money stays in the greater Detroit area,” he said.

The council turned down the center by a 4-3 vote after the panel listened to about 40 residents and stakeholders share their views for and against the project.

Daniels and council members Dave Henderson, Doug Tietz and Wade Fleming refused to award an architectural and engineering contract to design the facility. Mayor Pro Tem Maureen McGinnis and council members Jim Campbell and Dane Slater supported it. An approval was needed to meet deadlines to keep the funds. The center was slated to open in October 2013.

Hodges said despite the vote, the chamber isn’t ready to admit defeat. She said the group will work with its partners to see whether there are ways to keep the funds in Troy and save the project.

“This organization will be a pit bull in its quest for what will maintain an investment-worthy environment in Troy,” she said. “We will go to the stake in protecting our assets, and we will aggressively work with Magna International to preserve its stake here.”

Troy partnered with Birmingham on the transit project in 2000 when developer Grand Sakwa, under a consent judgment, donated the land to the city with the condition that it be used for the transit center. The property was to revert to Grand Sakwa if development deadlines were not met.

Birmingham, which has a free-standing bus enclosure at the Amtrak rail station, left the project in April after talks to buy land next to the CN Railway tracks failed.

The center was to be a regional transportation hub for SMART bus service, taxis and limousines.

Campbell said the outcome was a “slap in the face” to the business community and residents who backed the plan.

“I’m hoping this is not going to take a major toll on the city,” said Campbell, who was also elected in November. “I’d hate to see more vacant buildings.”