DETROIT – There aren’t many places about which you can say the future seems absolutely hopeless. But Highland Park, Michigan, the city that once put the world on wheels, comes pretty close.
Highland Park, a little enclave city embedded in Detroit, has been begging the state to hurry up and allow it to declare bankruptcy. The city, perhaps the poorest in the state, owes the Great Lakes Water Authority $24 million for old water and sewer bills. It hasn’t got it. Worse, there isn’t any foreseeable way it could ever come up with that much money –twice the impoverished town’s annual budget.
Some are suggesting that the other member cities in the water authority, which supplies water to about four million people, voluntarily absorb the debt. (Fat chance.) Others think that state or federal money should be tapped to pay it off.
Yet even if the debt were to be covered by a guardian angel, the sad fact is that within a very short time, Highland Park would almost certainly be in a fiscal crisis again. The tiny city is no longer economically viable. Nearly half its population is officially below the poverty line. Fires are common: Jobs and businesses, few.
Highland Park was once the heart of it all; a town known for its stately elm trees, magnificent homes, and Henry Ford’s vast plant that turned out millions of Model Ts a century ago. The Chrysler corporation was founded here, and built its first large factory.
Highland Park had more than 50,000 mainly prosperous people crammed in its three square miles in the 1930s. But then things started to decline. Ford moved most of its construction away, except for tractors, and completely abandoned the city in 1973.
Now, just the hulking remains of part of the Model T plant remains, behind the boarded-up old administration building, with its exquisite Pewabic tiles on the top. Chrysler closed its headquarters building and left the city in the early 1990s.
For a while, there were glimmers of hope. A nonprofit called HPDevco tried to lure jobs to the little city, with minimal success. Then, there was great excitement in 2014 when something called the Woodward Avenue Action Association bought the old Ford headquarters, and announced plans to turn it into an American Automobile Heritage and Welcome Center.
But they evidently couldn’t get the funding, disbanded and disappeared. Today, the building, like the city itself, is slowly continuing to decay. The last census found that Highland Park has fewer than 9,000 people, and has declined further since.
How bad are things? The school system has essentially collapsed; there is a charter elementary school, but Highland Parkers have to leave the city to go to high school. The police department is vestigial. Both the water authority and the media have reported that part of the reason the water bill is so high is that the pipes are so defective three-quarters of the water leaks out.
There is, of course, no money to fix things. Things in Highland Park are so dreadful, in other words, that during Detroit’s bankruptcy crisis, it was sometimes referred to as “Detroit’s Detroit.”
When attempts were made to merge it into Detroit, which at least can still provide service to its residents, the Motor City refused. Earlier this month, a Detroit News headline read “Highland Park Has Few Options, All of Them Bad.”
Charles Ballard, professor emeritus of economics at Michigan State University, devoted his career to studying the state’s economy. He believes that some of the problems here, as well as in other cities, stem from inadequate sharing of resources from the state. “If it were up to me, Michigan would have a much more robust system of revenue sharing from the state to the local” governments, he said.
But even more of local government problems, in Highland Park as elsewhere, have to do with “legacy costs associated with public-employee retirement and other benefits. Municipal governments made promises years ago that they would pay these benefits way into the future,” promises that could only be completely fulfilled if a lot of things went right, such as continued growth and prosperity.”
“And those things didn’t go right,” said Ballard, who noted that his own mother was born in Highland Park when the city was prosperous. Those problems afflicted Detroit, too, but the city also had considerable assets it could leverage to restructure local government and save most retiree pensions.
Highland Park has virtually nothing, and assets amounting to less than 10 percent of what it owes its retirees.
It’s possible that Highland Park may avoid imminent catastrophe over its water bill, thanks to bailout money from the federal or state governments, a negotiated settlement or perhaps all three. But worse is almost certainly coming.
There is a solution, one articulated more than thirty years ago by David Rusk, the former mayor of Albuquerque and an urban affairs expert: Metropolitan government. In his landmark book, Cities Without Suburbs, Rusk argued that “the real city is the total metropolitan area, city and suburb.”
“Elastic” cities, those that have been able to expand to annex suburbs or create a single governmental entity, like Indianapolis, generally do just fine; inelastic cities like Detroit, which has been unable to capture tax revenue that has fled to the suburbs, suffer.
Too often, however, prosperous suburbs have been unwilling to take on bigger tax bills to help their central cities; minority politicians in central cities haven’t been willing to cede power to suburbanites. There are signs things are changing, but for places like Highland Park, change may not arrive in time.
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(Editor’s Note: A version of this column also appeared in the Toledo Blade.)
