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Can Detroit's Turnaround Go Beyond Downtown?

Mayor Mike Duggan has pledged to spend $130 million to help revive neglected neighborhoods in the city.

Kids playing at a playground.
(Fitzgerald Revitalization Project)
Since Detroit entered into the nation’s largest municipal bankruptcy back in 2013, the city has been heralded as an unexpected comeback story, attracting billions of dollars worth of investment. But nearly all of that money and development has been concentrated in and around downtown. That’s left residents who occupy more than 100 square miles in the rest of the city wondering when it will be their turn for a comeback.

Mayor Mike Duggan says that day is near. Last year, he pledged to spend $130 million over the next five years on parks, streetscapes and development in 60 different neighborhoods. He got a big boost in December, when seven companies pledged $5 million each to the city’s strategic neighborhood fund. “We’re starting to see development through the corridor of all these different areas,” Duggan said.

The city’s neighborhoods can use a lot of help. Detroit’s median income remains half that of Michigan as a whole. More than a third of the city’s residents -- and more than half of its children -- live in poverty. It’s been estimated that Detroit is pocked by 30,000 abandoned homes and as many as 90,000 vacant lots. One project meant to be a showcase for neighborhood revitalization, a pledge to rehab or build more than 200 homes in the Fitzgerald area in the city’s northwest, fell 12 months behind schedule barely a year after it was announced. City officials say there’s a learning curve involved in making development happen in areas that haven’t seen much investment for decades.

One problem, as is so often the case, is financing. The few homes in Fitzgerald on which work was completed cost far more to rehab than their ultimate selling price. The city had to make up shortfalls left under federal grant programs. The fact that the mayor is raising money from private companies to shore up his neighborhood fund is problematic, says Sarah Reckhow, a political scientist at Michigan State University. It was one thing for philanthropic groups to play a major role in the “grand bargain” that staved off deep pension cuts and a fire sale of masterpieces from the Detroit Institute of Arts. Reclaiming neighborhoods is a more complex and more difficult task, not a one-off crisis remedy. “If we can’t pay for infrastructure with tax dollars,” Reckhow says, “maybe we need to look at the tax structure.”

That’s a fair point. But Duggan recognizes that for Detroit to be able to rebuild its tax base, it has to invest in itself. His effort to extend investment beyond downtown is clearly going to run into some bumps. Still, it’s an important attempt to find an antidote for areas in despair.

Alan Greenblatt is the editor of Governing. He can be found on Twitter at @AlanGreenblatt.
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