Detroit’s Tax Dilemma, a Local Government Anniversary and School Success

Can one school revitalize a whole city?
March 7, 2013

Can one school revitalize a city neighborhood and, perhaps, reverse decades of population loss for an entire city? That’s the intriguing question people are asking about a charter school in a St. Louis neighborhood. City Garden Montessori, located in Botanical Heights, once a crime-infested neighborhood, has been receiving perfect scores on a new state assessment program, a feat that has families moving to the neighborhood in droves, according to the St. Louis Post-Dispatch.

City Garden is a neighborhood-based charter school, which means families must live within in its boundaries in order to attend. City Garden’s stellar academic reputation has drawn the attention of not just families, but also developers who have begun fixing up and building new homes in the neighborhood to attract homebuyers. Developers say the school is a “big draw.” New shops are opening around the school; meanwhile school officials, who once had to scrounge for students, now say they have twice the number of applications than available slots for kindergarten.

Some people believe that the success of City Garden can be replicated in other St. Louis neighborhoods, creating a reverse migration and drawing families back into a city that has seen its population decline severely over the past 50 years. The Post-Dispatch explained the situation this way: “Community activists applaud City Garden for creating a successful school with strong ties to its neighborhood. But they also emphasize that in a city with thousands of school-age children, a school of 300 pupils is a small island in a big ocean.”

Things only seem to be getting worse, not better, for Detroit these days. When Michigan Gov. Rick Snyder declared Detroit in a fiscal emergency on March 1, he set in motion the long-anticipated state takeover of the nation’s largest city facing fiscal calamity. Many city officials have denounced the move, arguing that they have taken steps to fix the city’s budget problems and that the takeover is not only unnecessary but also a blow to democracy.

It’s not a new story: The city’s population has shrunk by 25 percent over the past 10 years. The decline started as the auto industry shed jobs, but now many are leaving to flee a broken education system, high crime or the city’s high property taxes. In fact, half of the residents who remain don’t bother to pay them, according to Anthony Flint of the Lincoln Institute of Land Policy. “Exasperated residents are surrounded by broken streetlights and overgrown parks, and don’t feel government will be [there] for them if they call. So many residents simply ignore property tax bills, further diluting city services.”

The Detroit News recently found that Detroit ranked first among the 50 largest cities in taxes,, and last among property values. Detroit taxes on a $150,000 house were $4,855, twice the national average of $1,983. However, the city’s average house price, $16,800, was nearly 10 times lower than the next lowest city, Mesa, Ariz.

The city is owed $246 million in unpaid property taxes and collecting as much of that amount as possible will be critical to fixing the city’s problems, according to experts.

This month, the city of Hickory, N.C., will be holding a rather unique celebration: The 100th anniversary since it voted to become one of the first cities in the country—and the first in North Carolina—to have a council-manager form of government. The vote came about because some believed mayors held too much power. So on March 17, 1913—St. Patrick’s Day—city residents went to the polls and voted to amend Hickory’s charter and adopt the manager-council form of government, by a vote of 291 to 256, according to the Hickory Record.

In 1908, Staunton, Va., became the first city in the country to switch to the council-manager form, creating a new option for how local governments could operate. In 2008, the International City-County Management Association (ICMA) released a report showing the council-manager form of government has grown steadily over the century, and quite significantly between 1990 and 2007 (45.5 percent), primarily among cities with populations of less than 10,000. Larger-sized cities that had adopted the council-manager form also increased in number during this period, though the two forms were almost evenly divided for cities between 250,000 and 500,000 in population.

Will the trend continue? Some experts say the shift to the council-manager form of local government has peaked. Indeed, the ICMA report points out that despite the healthy expansion in the council-manager form, the overwhelming majority of American cities have not changed, holding on to the mayor-council form of local government. Out of 19,000 municipalities in the country, only 3,500 cities with populations exceeding 2,500 use the council-manager form of government today. There are some who question whether the manager-council form, especially for large cities, has the political strength and mandate to deal with big issues, such as pension reform and other problems that have emerged during this era of belt-tightening. (For an excellent analysis of the mayor-manager debate, read former Governing Executive Editor Alan Ehrenhalt’s examination of the issue.)

While not infallible, the council-manager form of government has proven resilient, however, with Hickory as one example of its endurance. But local governments are perhaps facing one of their biggest challenges ever, as fiscal uncertainties continue to drag on and the running of a city becomes more complex. Which form of government -- mayor-council or the manager-council -- proves most adept at dealing with 21st century challenges remains to be seen. Perhaps the answer is both.

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