The MaiaCo Contract: A Neo-Colonial Nightmare

by Ruth Needleman
1 August 2016

[ed. note – the parenthetical citations refer to page numbers on the MaiaCo contract, which we will publish when we obtain a digital copy.]

This is an introduction to the MaiaCo contract. To begin with, MaiaCo will be assuming major responsibilities for the development of large areas of Gary. In fact, think of MaiaCo as our new private corporate Mayor and Redevelopment Commission in charge of deciding and implementing Gary’s future development.

The City will reimburse MaiaCo for every penny and minute it spends (100%) and then will give MaiaCo 65% of any income from land leases or sales to third parties, whether or not MaiaCo directly arranges the transaction, if it occurs within a “Designated Project Area.” The word “profit” does not appear anywhere. The new term is “Transaction Proceeds.” The “Designated Project Areas” will be mapped out over time, although within 30 days, the GRC and MaiaCo will “prepare an annual plan outlining the key strategic priorities, assignment of responsibilities and projected delivery of Resources.” Resources means time, work, materials and money committed to the project. It will be like paying for a private shadow government.

Once an area is designated, MaiaCo will take over all lands belonging to the GRC, and will have the GRC acquire all lands available through tax sales or otherwise. MaiaCo will bundle and sell or lease areas acquired to third parties for development. MaiaCo selects and oversees the third party developers, but it is not so clear who oversees MaiaCo.

How much community participation? Basically not much, unless you are considered to be a major stakeholder. [“ensure active participation by key stakeholders.”] (1) At our expense, MaiaCo will hire a Gary resident to open an office in the City, provide quarterly reports, and show up at selected public and private meetings. MaiaCo will produce a community involvement plan, which will enable MaiaCo to participate in any community initiative within the Redevelopment Area. This guarantees MaiaCo involvement in all economic activities in the Area; it does not guarantee the community itself any degree of participation. (13)

How about local hiring? The Contract only provides for the possible hiring of local businesses, contractors and subcontractors, but there are exemptions galore. For example, any business already working with MaiaCo will not have to meet any requirements for local hiring. Not MaiaCo but its contracted businesses will have to document efforts to hire locally. “Local” means Gary first, then East Chicago and Hammond, but “local” also means “businesses with a significant pre-existing presence in the Northwest Indiana region.” (3) So even though MiaiCo is “brand new,” local businesses have to already have an established record.

In addition, MaiaCo “may elect to engage a non Local contractor, despite the availability of a Local option, should MiaiCo reasonably determine that the cost or quality of the services to be delivered justify such a decision.” (4) MaiaCo gets to decide on a case by case basis.

Its contractors have to document efforts to hire local businesses to show “a good faith effort.” We all know what a good faith effort is! The contract includes percentage goals (20% local minority, disadvantaged, veteran businesses and 5% women-owned businesses), but not requirements.

Section 2 of the Contract outlines all the “Resources” that Maiaco will provide, everything from a new zoning plan to detailed architectural planning services, legal advice, infrastructure recommendations, preparation of documents, purchase and maintenance of lands and so on. MaiaCo will even assist and advise the GRC on any sale of property to any bidders, and be paid for it. Their only obligation to local hiring: “MaiaCo will be expected to take those commercially reasonable actions as agreed to by the parties in assisting and encouraging third party developers to achieving participation of local businesses.” (12)

Do we know who is part of MaiaCo? The materials identified only top officers, all white men, not one from Gary. But who are MaiaCo’s “affiliates, partners, joint venture partners, directors, shareholders, members, managers, officers, agents, attorneys, employees, mortgagees, successors and assigns and their respective partners…etc.”

When do we find out who will be taking our money, who will be benefitting from this Contract? Usually when a major RFP like this gets only one acceptable bid, the RFP goes out again. But this contract was rigged way ahead of time.

The MaiaCo principals all claim to have “proven and longstanding commitment to the City.” When will we see a list of all the projects in which people from MaiaCo have “successfully worked with the GRC and the City of Gary”?

What is missing is oversight, accountability and transparency. Without an outside Community Enforcement Mechanism, Gary will become the colonial creation of neo-liberal big money Chicago interests. A suburb of Chicago??? Will the history, traditions, culture and creations of Gary people be stripped away, replaced by gentrified housing and commercial interests unappealing to Chicago? Will the people of Gary, called in this document “legacy residents,” be pushed aside and sent packing? Gary has turned over the reigns of the City to a Mayor and his ilk who drove 65,000 African Americans out of Chicago to make way for “redevelopment.”

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One comment on “The MaiaCo Contract: A Neo-Colonial Nightmare

  1. […] October 5, 2016-The Northwest Indiana Federation of Interfaith Organizations has issued a scathing critique of the City of Gary contract with MaiaCo. MaiaCo is a Delaware Corporation created by former Chicago Mayor Richard M. Daley. The corporation received an exclusive contract to engage in redevelopment in the City of Gary in a special meeting on July 29, 2016. The letter can be viewed in its entirety here-https://garyarea.wordpress.com/2016/08/01/the-maiaco-contract-a-n… […]

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