Detroit’s comeback might leave some residents behind

By CHEYNA ROTH
Capital News Service
LANSING – Persistent poverty and a focus on commercial developments in Detroit are raising concerns that efforts to revitalize the city are ignoring its low-income population.
“We don’t talk enough about how Detroiters who grew up in the city and are now in their 20s and 30s are concerned they won’t be able to participate in the revival of the city that made them,” said Aaron Foley, a Detroit writer whose book, “How to Live in Detroit Without Being a Jackass,” published by Rust Belt Chic, is due out this fall.
Detroit’s economic and cultural health are tied directly to Michigan’s overall fortunes. Gov. Rick Snyder has said a strong Detroit is central to revitalizing the state. Millions of dollars have been invested in moving the city through bankruptcy and rebuilding parts of the city, such as refurbishing the David Whitney Building into luxury apartments and office space.

The attention has attracted an increase in upscale stores and restaurants. Two alcohol “distilleries,” or liquor manufacturers, Two James Spirits and Detroit City Distillery, have opened in Detroit since 2013, and in February two new breweries opened their doors on the same day.
A restaurant specializing in “farmstead” cuisine replaced a pawnshop in Corktown in December 2014, and an artisan chocolatier and John Varvatos menswear store opened in April 2015.
These new and refurbished buildings may increase property values, but they are designed to bring in high-income residents, not benefit current low-income residents, said Joe Darden, professor of geography at Michigan State University and co-author of a book on race relations in the city.
“The low-income people are not a priority for the developers in Detroit,” Darden said. “And that will continue to be the case if the dependency is on the developers.”
The only way to ensure that the needs of low-income residents are met, Darden said, is for elected officials to rely less on developers and tie development tax credits to construction of low-income housing. For example, if a developer is refurbishing an apartment building with state dollars, the developer should be required to have some apartment units available for lower-income residents.
Detroit’s unemployment rate was 12.2 percent in December 2014, according to a study by Wayne State University’s Center for Urban Studies, compared with 6.3 percent in Michigan overall. In 2013, the city’s median household income was $26,325 — a little more than half of the state’s $48,411, according to the U.S. Census Bureau.
Meanwhile, although city property values dropped nearly 10 percent from 2013 to 2014, the property tax burden for homeowners is highest among the 50 largest U.S. cities, according to a 2014 study by the Minnesota Center for Fiscal Excellence.
The breweries and upscale apartment buildings are taking away the character of Detroit’s downtown as well as displacing residents, pushing them toward the northwest area and older suburbs of Wayne County, said state Rep. Rose Mary Robinson, a Democrat from Detroit.
The developments are not designed for low-income residents, and the city is mistaking gentrification for a comeback, Robinson said.
Increasing jobs in the restaurant and bar business does not aid residents in need of stable employment, especially those who can’t get into town from the city’s northwest and east sides, said Alex Hill, project coordinator at a multidisciplinary research center at Wayne State University.
But many state leaders say commercial redevelopment and economic growth are a necessary step toward improving the lives of Detroit’s residents.
“Midtown and downtown Detroit are coming back strong already,” Gov. Rick Snyder said in an interview with Capital News Service. “The challenged area, more than anything, is in the neighborhoods. So the question is, what can we do to help the neighborhoods?”
Detroit Mayor Mike Duggan echoed the turn toward neighborhoods in his State of the City address and recently announced new financing programs for new homebuyers and current homeowners.
On April 16, Duggan’s office announced a new program designed to help homebuyers get mortgages in spite of low home values. These loans will be at a below-market fixed rate and offered only to people buying a home they plan to live in. There will be no down payments, closing costs or fees for qualifying buyers who can demonstrate steady income and good bill payment history.
The mortgage plan follows a March announcement of no-interest home-repair loans for qualifying low-income residents.
After years of predatory and discriminatory lending, the mortgage program is important and possibly the only option, Hill said. But others are not convinced.
Such programs “mean nothing” to many struggling Detroit residents, said Khari Brown, associate professor of sociology at Wayne State. The incentives only work for people with steady jobs, but the labor force is less than 50 percent of the current Detroit population, Brown said.
Urban poverty is directly connected to race, Brown said, and he advocates tying funding — state or federal — to incentives to provide for affordable housing.
But the affordable housing needs to not only be in the city of Detroit, where schools are struggling and jobs are the few, Brown said. Affordable housing needs to be moved into the suburbs where jobs and stronger schools are located, he said — or at least public transportation options must be improved.
Darden said he has not seen government programs in Detroit that will allow for upward mobility. He agrees with Brown that programs will only help low-income residents if they offer residents a place to live with sufficient job opportunities, high-achieving public schools, and opportunities for upward mobility.
“If the city is to grow, opportunities must precede that growth,” Darden said. “If the opportunities are there, growth will be there. If opportunities are not there, growth will not be there. So Detroit is declining because the opportunities are not in the city.”