Kevin Houston surveyed the street in Highland Park, Michigan, where his home is situated amidst vacant, overgrown lots, abandoned houses, boarded-up businesses, and potholed roads. The community is on the brink of financial ruin, unable to pay its bills to the utility company providing drinking water and sewage services to the surrounding city. Highland Park serves as an example of blue-collar towns that have lost their way in the wake of manufacturing changes, leaving them as empty shells of their former selves, plagued by neighborhood malaise, neglect, and deep poverty.
At its peak in 1930, Highland Park had a population of over 50,000 people. The elegant and spacious homes rivaled even those of Detroit. Today, the city is just under 3 square miles (7.8 square kilometers) in size, and only a fraction of its former residents remain. The manufacturing industry that once defined the town has long vanished, leaving behind only strip malls and retail shops to prop up the dwindling business tax base.
Highland Park is currently in debt to a regional water service company for approximately $20 million, and in order to stay financially afloat, they are considering municipal bankruptcy. This strategy allowed Detroit to erase or restructure $7 billion in debt a decade ago. Cities like Highland Park present significant challenges in terms of finding solutions, as they have few assets to build upon. Alan Mallach, author of the upcoming book “Smaller Cities in a Shrinking World: Learning to Thrive Without Growth,” stated that these cities have “appalling levels of poverty and abandonment” and likely cannot turn things around on their own due to a lack of resources.
Highland Park and similar communities have experienced a decline in recent years due to the loss of jobs and families moving away, but before this decline, the auto and manufacturing industries helped build up some of these inner-ring suburbs.
In 1907, Henry Ford purchased 160 acres of land in Highland Park for the establishment of his Ford Plant. A few years later, the first moving assembly line was introduced at the plant. This proved to be a key development in the manufacturing industry, and immigrants and other workers flocked to the area, attracted by the promise of earning $5 a day. A building boom followed, resulting in thousands of homes being constructed along the area’s tree-lined streets.
According to Jeff Horner, an urban studies professor at Wayne State University in Detroit, Highland Park was once a highly desirable and prominent suburb, often referred to as a “shining city on a hill.” Henry Ford was instrumental in its success, credited with turning it into an important and prosperous suburban community managed by his political associates.
However, in the 1920s, Ford moved its auto manufacturing operations to nearby Dearborn, and both Ford and Stellantis (formerly Chrysler) ultimately left Highland Park in the 1990s. Like many large cities, Highland Park suffered a decline as white residents moved to the suburbs, taking jobs with them. As a result, approximately 85% of Highland Park’s current population is Black, with a median household income of approximately $25,000 and about 40% of residents living below the poverty line, according to data from the U.S. Census.
The effects of neglect and neighborhood malaise are readily apparent in certain parts of the city. For instance, in early February, the bodies of three aspiring rappers were discovered in a vacant apartment building overrun by rats. The trio had been slated to perform at a Detroit club on January 21, but disappeared beforehand.
Professor Horner emphasized that Highland Park is presently bereft of a tax base to rebuild the city, stating that “Any time you’re a small, inner-ring suburb that can’t grow in land you have to bring in a tax base. You have to bring in more residents.”
Highland Park reported a property tax total of around $9.6 million for the 2022 fiscal year, while expected earnings for the 2023-2024 fiscal year are estimated to be around $12.6 million, according to Mayor Glenda McDonald’s budget proposal. The proposed budget would generate $4.7 million and $2.6 million in revenue from income and property taxes respectively, with the remaining $3.5 million originating from state revenue.
Mayor Glenda McDonald declined to comment on the water debt owing to ongoing court-ordered mediation with the Great Lakes Water Authority. That debt is believed to go back at least to the 1990s, when the Detroit Water and Sewerage Department was in charge of the water system.
Highland Park has been in a financial emergency since 2014 and a manager was appointed to oversee the situation. The water department received a $19 million judgment against Highland Park in 2015, and ongoing mediation is expected to lead to a plan for repaying the debt. According to the water authority, Highland Park has not made any payments for its sewer services since April 2021 and has paid less than 1% of its water service charges since 2012. This has resulted in other communities in the system incurring charges due to Highland Park’s previous nonpayment, with the authority stating that those communities “have no sympathy” and are not willing to continue floating the city’s debt.
Although Highland Park’s council voted for bankruptcy in April, some believe that this would be only a temporary solution. According to Alan Mallach, bankruptcy is not a permanent fix for Highland Park’s issues, which extend beyond just the water debt. The city is unable to generate sufficient revenue to provide services or restore the value of its properties.
However, Kevin Houston, a resident, stated that he could not disagree with bankruptcy if it was deemed the best option.