News Story

Small Business Owners Face Significant Challenges Operating in Detroit

Video series highlights problems entrepreneurs face in the city

The plight of Detroit has been told and re-told, and most everyone has an opinion.

But an important voice has been missing from the conversation: small business owners.

A three-part web-video series has been launched by the national group, Bankrupting America, a project of Public Notice, an independent non-profit group that focuses on how government policies affect America. The series is titled, "The Story of Business: Detroit."

Each video focuses on a different business that is "trying to stay afloat and invest in their community, despite the financial uncertainty and shrinking population resulting from the city’s bankruptcy."

The state of Michigan, city employees, and unions are hashing it out in court over bankruptcy proceedings.

Part one of the video series focuses on Hector and Janet Sossi's family-owned Roma Café, which is Michigan's oldest continuously run restaurant, established in 1890. Hector, who is 90-years-old, came to Detroit in 1940 and started out as a busboy. He eventually took the place over and his daughter Janet Sossi Belcoure runs the restaurant now.

"A lot of the large, wonderful businesses that have come in have gotten some tax breaks to come down. And we don't get tax breaks — we've just gotten more taxes," Belcoure said in the video. "One year, I get an awning tax and I call the city, and say, 'I don't even know what that is.' When I finally could get a hold of someone who could explain it to me, they says, 'well, your awning is over a city sidewalk and you will be taxed yearly.' "

Barbershop owner Percell Jordan is the focus of part two of the video series and shows the stress Detroit's bankruptcy has placed on his shop, Percell's Extraordinary Cuts.

"One day, a guy asked me to cut his hair. I said, 'give me $3, and I'll cut your hair,' " Jordan said in the video. "And once that $3 got in my hand, I said, 'I can cut some hair.' "

Percell and his customers say they think crime is the most significant problem in the city. But also, "red tape needs to be cleared out," Percell said, relating a story about the city fining him for putting up a sign. He had to hike through City Hall to try to figure out how to even start his business.

Part three is about Austin Black, owner of the real estate firm, City Living Detroit, who is hopeful for the city's future. He lived in the city as a kid and came back after graduating college.

"A lot of the challenges feed off each other," Black said in his video. "First you had people fleeing the city. Then, in order to make up for that loss, the city increased the taxes. And then more people left. And eventually you had too many people leaving that the businesses left. And then you had the unemployment issues."

"Detroit is a reminder of what happens when fiscal irresponsibility is mixed with poor leadership: high taxes, high unemployment, and $18 billion in debt liabilities," Gretchen Hamel, executive director of Public Notice, said in a statement. "The people of Detroit deserve better, and it's refreshing and inspiring to see that they are still determined to succeed and improve their city, despite the fact that their government couldn't. The key to the city's rebirth will be people like the ones we talked to who are willing to invest in their community and smarter government policies."

Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.