Kotz, Sangster wins appeal in favor of Detroit’s Downtown Development Authority

Appellate Court Dismisses Challenge Over Separation of Church and State

DETROIT, Mich., (June 23, 2009) — Kotz, Sangster, Wysocki & Berg’s commercial litigation team, led by Jeffrey M. Sangster and Frederick A. Berg, recently won an appeal in favor of the City of Detroit Downtown Development Authority (DDA) in an appellate action brought by American Atheists, Inc., a non-profit organization dedicated to the separation of church and state.

American Atheists challenged that tax-generated grant money awarded to three Detroit churches violated the First Amendment of the United States Constitution, and its counterpart in the Michigan Constitution. The DDA’s Lower Woodward Facade Improvement Program awarded grants to qualified property owners for work performed to improve the visual appearances of properties in downtown Detroit.

“The program allocated grants to a broad spectrum of entities on a neutral basis” said Frederick Berg, partner of Kotz, Sangster, Wysocki and Berg, P.C. “The DDA sought to provide aid to property owners willing to fix up their buildings in downtown Detroit, not to promote a religion.”

Established in 2003, the Lower Woodward Facade Improvement Program was one of many initiatives by the City of Detroit to revitalize the downtown area prior to the national events scheduled in Detroit, including the 2005 MLB All-Star Game, 2006 NFL Super Bowl and 2009 NCAA Men’s Basketball Final Four.

During the program’s two and a half years, the DDA approved 123 projects, of which 91 were completed at a cost of $11.5 million. Qualified applicants were reimbursed for 50% of the costs of the renovations, subject to caps of $150,000 per building and $30,000 per parking lot. Nine projects involved renovations to buildings and parking lots owned by three downtown Detroit churches and totaled $737,000, roughly 6.5 percent of the total reimbursements.