Friday, August 1, 2014

Dealing with Detroit's abandoned and crumbling buildings could cost $1.9B — that's $2,600 per resident.

Detroit has more than 80,000 properties that are vacant or in disrepair. Getty Images

Here's a sign of how bad things are in Detroit: one in five properties are damaged, vacant, or flat out uninhabitable. And an estimated 70,000 may need to be demolished over the next five years.

That's the finding of a new report from the city's Blight Removal Task Force, a team established by the Obama administration when in late 2013 it pledged more than $320 million in relief for the city. That report says the city may need nearly $2 billion to relieve the city's blight problems.

To measure the size of the problem, the task force sent 150 surveyors out into the city over the course of 10 weeks to count up the number of blighted properties. What they found: 84,641 Detroit properties are blighted, meaning they fit into a list of criteria for properties that are in some state of major disrepair: being classified a fire hazard, for example, being fire damaged, or having been abandoned for five years or more and are not up to code. The total also includes vacant lots that have "evidence of dumping" and need "immediate attention.

According to the Detroit News, these nearly 85,000 properties account for roughly 22 percent of all properties in the city. And altogether, the group estimates that 72,000 structures should be demolished over five years — around 1,200 per month.

Fixing residential blight alone will cost $850 million, the task force estimates. Add in the nonresidential properties, and it's another $500 million to $1 billion.

That potential $1.85 billion totals out to just over $2,600 for each of Detroit's roughly 700,000 residents. That 700,000 is itself a sign of how troubled the city has become. As of 1950, the city had more than 1.8 million people.

While it's great to have a plan in hand, the price tag on fixing blight currently appears too high for a city that's already financially troubled.

"With every source of funding accounted for, Detroit still faces a shortfall of approximately $400 million in the coming years, just to address neighborhood blight," the authors write. "Adding in the large-scale commercial and industrial projects increases the gap to as much as $1 billion."

The Obama administration has been continuing to try and help the city that in July 2013 filed for bankruptcy and has around $18 billion in debts. The White House in April said it was attempting to free up $100 million from its Hardest Hit Fund, a fund established in 2010 to help out the states and cities most affected by the housing downturn.

Of course, Detroit's problems have been around since well before the recent recession. Cleaning up the blight is just one step in revitalizing the city's economy. That said, the report did identify one bright spot: demolishing all of those properties could create hundreds of new jobs in the city.

Further reading:

  • This is the final report from the Blight Removal Task Force.
  • GooBing Detroit, a Tumblr using Google Streetview to document decaying Detroit properties, is an eye-opening and depressing look at what's happening in the city.
  • Emergency manager Kevyn Orr filed a plan of adjustment in February, addressing how the city plans to tackle its massive debts and pay off its creditors.
  • Back in September 2013, the Detroit Free Press did an extensive investigation into how the city went so far into debt, finding that it involved decades of mismanagement.
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