Rod Meloni: What the new Cobo teaches us

Rod Meloni discusses lessons learned from construction at Detroit convention center

By Rod Meloni - Reporter, CFP ®

DETROIT - It seems like only yesterday Monica Conyers and her boisterous amen chorus claimed Detroit was perfectly capable of taking care of Cobo Center's needed $100 million dollar rehabilitation.

They played the race card charging suburbanites were anxiously lying in wait to steal Detroit's "jewels."

I vividly remember one day in her tumultuous term as City Council president calling Local 4's Roger Weber a liar, that no one had broadcast problems with Cobo Center until someone started talking about a Regional Authority.

One of the great parts of television news is that the camera does not lie. 

Roger's Cobo tour back in early 2009 showed the leaky roof, the Rube Goldberg Gerry-rigging the Teamsters built to collect rain water in giant diapers, they used hoses to funnel the water to 50-gallon drums outfitted with sump pumps.

Doors were bent and rusted, garage sliders frozen shut, loading docks held back by trucking straps and broken water pipes incessantly streamed water into gutters.

The North American International Auto Show backers [the Detroit Auto Dealers Association] had had enough. They said and were not kidding they would take the auto show to Chicago or L.A. if something didn't change and fast. Cooler head's than Monica's prevailed and the Detroit Regional Convention Facility Authority took over just over three and a half years ago.

What the Authority has accomplished is a lesson to us all about how we view any of the city's or even Wayne County's "jewels."

Cobo was a city entity.

In addition to literally falling apart at the seams, its management under the Kwame Kilpatrick administration was corrupt. Its director went to prison for taking bribes from West Bloomfield businessman Karl Kado. He ran the Cobo concession business. He testified on numerous occasions Cobo's [as well as the City's] culture was all about cash passed in envelopes.

Let's not forget Monica Conyers, the most vocal opponent of change at Cobo, went off to prison for taking bribes too.

Year after year Cobo was allowed to deteriorate.

Year after year Cobo would lose money. Let's re-emphasize here it was a slow moving, poorly run, unprofitable government operation. Only the ultimate threat to leave town of its biggest, most important and nationally known customer could convince anyone there was anything even remotely askew along the Detroit River.

Let's fast forward three and a half years.

Cobo Center in many respects is unrecognizable. We took a tour today and the roof is water tight, the loading dock repaired and reconfigured, garage doors work.

The auto show this year was one for the record books and used the new atrium that allows patrons to look out over the Detroit River in the same manner they can inside GM's Renaissance Center Wintergarten.

The authority's construction opened up the roof with skylights.

Cobo Arena is as distant a memory now as a live Jimmy Page guitar solo. Its seats long gone, its floor re-poured and leveled, converted into banquet or convention space that can accommodate thousands who might attend multiple conventions at one time. This will assure that the auto show isn't the only big convention held here in the future.

Perhaps more impressive is the fact that they added parking spaces in two garages, one under Cobo on Washington and another on Congress. Many of those parking spaces are rented out to monthly renters like Dan Gilbert's Quicken Loans. But there are plenty of spaces for events.

They are churning cash for the Authority. It reported today it has exceeded its budgeted income of $863,000 with four months left in the fiscal year.

A profit coming out of Cobo Center? How is this possible? It hasn't happened in a generation! What's changed?

Authority CEO Patrick Bero told Local 4 News there are a couple of reasons: "The Authority has consistently demonstrated that when you have professionals in charge and they know what they are doing you can get a lot accomplished… we are getting the greatest value for every single penny that we put into this place and we're going to be able to demonstrate to the community and the marketplace it's a wise investment."

What he is really saying is he feels an obligation to his shareholders; the taxpayers of Michigan and in particular Metro Detroit.

They have applied private business principles to what had been an exceptionally poorly run government entity. It's really a public/private partnership but there was pressure to prove that there is genuinely a different and better way to treat a city's "jewels". This is it!

Now, I am in no way saying public/private partnerships are perfect, nor am I saying business principles are always perfect.

GM and Chrysler nailed that notion shut at roughly the same time as Monica Conyers was spewing her falsehoods all over town.

I mention all of this because I have spent the last decade chronicling Detroit's demise, and have spent the last year beginning to wade into Wayne County's financial fiasco.

As I stood in Cobo today it struck me, this is the way things are supposed to run.

GM and Chrysler failed because they did not operate under normal business principles. Any entity operating under the same failed construct, i.e. defined benefit pensions, lifetime healthcare and featherbedded job programs that suck up profits like pigs do slop, is doomed to fail.

Thus, Detroit and Wayne County are looking into that similar financial abyss.

Cobo Center's resurgence teaches us all that sound business practices, turning a profit and serving the public/shareholders as partners, future prosperity is possible.  

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