Cleveland has a big problem. It was once the fifth-largest city in America. In 1950, Cleveland was bursting at the seams with more than 915,000 residents. The Shoreway opened in 1938, and major extensions were westward (1940) and eastward (1941) soon after. It is now designated I-90. The rest of I-90 (also known as the Inner Belt Freeway) zig-zags across downtown to the Tremont neighborhood, where it resumes its westward course. This section opened in December 1959. A major southern extension, the Willow Freeway (now I-77) was approved in 1939. After an interruption by World War II, it opened in 1950. To ease congestion on the Willow, a second south-bound interstate highway, I-71, opened in 1959. I-480, linking southeast Cuyahoga County with Bedford before cutting due west across the southern surburbs, began construction in 1957 and opened in 1966. A parallel route -- I-490 -- began construction in 1969 at I-90 at Tremont. It was designed to connect with I-77 on the east bank of the Cuyahoga River, and then cut across Shaker Heights by turning Fairmount Blvd. into an interstate highway until it reached I-271 in Pepper Pike. Opposition to the plan in Shaker Heights truncated the freeway at E. 55th Street.
All those roads.........
All that sprawl...........
And yet, even as the city was building these roads, it was collapsing. Major heavy industries abandoned Cleveland in the 1960s, and the population fell a whopping 14.3 percent to just 751,000 people. A major exodus of industry, residents, and retail business occurred in the 1980s as the population crashed by 23.6 percent to reach just 574,000. Most of Cleveland's housing stock, which served the working-class residents feeding Industrial Valley's heavy industry, was abandoned. Vast tracks of cheaply built, clapboard, Victorian housing lay uninhabited. The once-thriving area between Euclid and Woodland Avenues became a quasi-ghost town. Tremont, Brooklyn Centre, Brooklyn Heights, Cuyahoga Heights, and Newburgh Heights suffered immensely. But the collapse wasn't over. By 1990, Cleveland had lost another 11.9 percent of its population, falling to 505,000 people. Another 30,000 people, or 5.4 percent fled the city in the 1990s, but the city took another massive population hit in the first decade of the new century as 17.1 percent of the population fled -- bringing Cleveland's population to just 397,000. Total population loss over 60 years: 57.5 percent. Total population loss since 2000: 18.7 percent
Half the city's housing stock now stood empty.
How can a city deal with that?
Let's consider Detroit. During the same 60-year period, Detroit lost 63.3 percent of its total population. Since 2000, Detroit has lost 28.5 percent of its population. Total population loss is roughly equal, although Detroit's collapse since 2000 has been far more severe.
This year, the City of Cleveland decided to do an inventory of all housing stock in the city. It quite literally had no idea how much housing stock there was, or whether any of it was still standing. The city had long ago seized vast quantities of housing stock over unpaid taxes. But the housing stock just sat there, without maintenance or care. With so much housing stock abandoned, was any of it habitable? What should be demolished? What should be rehabilitated and sold? The city just completed that inventory.
Detroit is working on the "now what?" answer.
Detroit identifies neighborhoods on the cusp of dissolving or which have only recently depopulated. It uses eminent domain or tax liens to seize abandoned housing, sells it at an extreme loss (one-tenth the price), and then issues a grant (worth about two-thirds the price of the house) to the new owner to bring the home up to code.
Because housing costs in Detroit are so low -- a typical two-bedroom home sells of just $38,000 -- the city can recreate a neighborhood almost overnight. The re-created population density lures in businesses, especially small retail and dining, which makes the neighborhood stable again. The real estate market gets restarted, and property values rise.
What's interesting about this program is that it's almost entirely publicly funded. At first, that seems ludicrous: Detroit can't keep the lights on, so why is it spending millions of dollars on this program?
Because Detroit's financial base is about property taxes. It is generating none. By spending a little money now, Detroit is not only stabilizing its population, but the city is creating valuable housing stock from abandoned property. The city is seeing property values rise in neighborhoods which had been abandoned and had zero property value before. As residents return to Detroit, the city sees its sales tax revenue and its income tax revenue rise.
In the long run, the expenditure is better than not having intervened. It pays off. It revives.
Listen up, Cleveland. This is your future, too.