DETROIT AFTER BANKRUPTCY : are there trends towards an inclusive city?

Detroit is the first city of its size to become bankrupt and some policy makers have argued that, since then, it has entered a ‘new beginning’. This book critically examines the evidence for and against this claim. Joe Darden analyses whether Detroit’s patterns of race and class neighbourhood inequality have persisted or whether investments have led to improvements in academic achievement, homeownership, employment, and reductions in poverty and violent crime. He measures, quantitatively, the benefits and disadvantages of staying in urban Detroit or moving to the suburbs, and provides evidence to answer whether Detroit, after bankruptcy, is becoming an inclusive city. Front Cover Detroit After Bankruptcy: Are There Trends towards an Inclusive City? Copyright information Dedication Table of contents List of Figures and Tables Acknowledgments Preface 1 Antecedents to Bankruptcy Introduction What led to the City of Detroit’s bankruptcy? White flight and economic disinvestment Consequences of disinvestment and discrimination The myth of living cheaply in Detroit Geographic, social, and economic conditions in Detroit on the eve of bankruptcy The importance of neighborhood socioeconomic characteristics, racial residential segregation, school quality, and the academic achievement gap The history and impact of declining state revenue sharing to Detroit compared to other municipalities Local difficulties in Detroit and other units of government The premise of the Emergency Manager Law The history and provisions of the Emergency Manager Law in Michigan Conclusion 2 Detroit Bankruptcy Introduction The legal origin of and reasoning behind the bankruptcy What was the Plan of Adjustment? Judge Rhodes’ rationale for approving the Plan The State contribution agreement The Detroit Institute of Arts settlement The Other Past-Employment Benefits settlement The 36th District Court settlement Unlimited Tax General Obligation bonds settlement The Limited Tax General Obligation bonds settlement Discussion related to classes 14 and 15 of creditors that rejected the Plan The importance of good faith The constitutional claims against the city The decision makers supporting the Plan The Proposal to Creditors The outmigration of residents and businesses Detroit was not paying its debts Lack of resources for public safety Lack of resources to address the deterioration of the city The key objective for a financial restructuring and rehabilitation according to Orr Limited options for further revenue generating What assets the city owned at the time of the assessments Belle Isle Park The Detroit Institute of Arts City-owned land Parking garages/lots Conclusion Meetings to discuss his Proposal to Creditors Judge Steven Rhodes and the other decision makers Judge Gerald Rosen 3 The Postbankruptcy Social and Spatial Structure of Metropolitan Detroit Introduction Explaining the Darden-Kamel Composite Socioeconomic Index Definitions of the variables Calculating and standardizing these composite socioeconomic variables The importance of the variables in describing neighborhood socioeconomic characteristics Percentage in poverty Unemployment rate Median household income Occupational status Educational attainment Median housing value The percentage of owner-occupied housing units Median rent Percentage of households with a vehicle available The inequality gap between neighborhoods in Metropolitan Detroit in 2011–15 and 2016–20 Racial residential segregation over clusters of neighborhoods based on socioeconomic characteristics Racial residential segregation between Blacks and whites (2016–20) Residential segregation of Hispanics and non Hispanic whites (2011–15) Residential segregation between Hispanics and non Hispanic whites (2016–20) Mapping the neighborhoods of Metropolitan Detroit based on the Darden-Kamel Composite Socioeconomic Index Conclusion 4 Gentrification Introduction The objectives Past studies of gentrification Gentrification in the United States The significance of this chapter Does gentrification harm or help poor neighborhood residents? Is race a factor in gentrification? The Detroit Model The new method to determine gentrification: the Darden-Kamel Composite Socioeconomic Index Determining gentrification in Detroit Did race matter in the gentrification process? Did gentrification result in more racial residential desegregation? How did the Detroit Mayor and the City Council assist predominately Black and poor neighborhoods to negotiate with white developers in the gentrification process? The demographic characteristics at the time of the Neighborhood Funding Strategy Community benefits agreements The Community Benefits Ordinance Conclusion 5 The Uneven Distribution of Economic Redevelopment Introduction Mayor Duggan’s influence on development White developers selected by the city for downtown development Dan Gilbert Real estate redevelopment in downtown Detroit The Detroit Land Bank Authority, homeownership, and foreclosures How the Detroit Land Bank Authority auctions off homes Race matters in the home purchase process Developers and redevelopment of neighborhoods and the Inclusionary Housing Ordinance Budget priorities of President Sheffield Some redevelopment activities in selected neighborhoods Brush Park development Corktown development Fear of displacement by residents of Corktown The Oakman Boulevard neighborhood Opportunity Zones in Detroit The implementation of the program The intended target neighborhoods for zone investments Opportunity Zone tracts in Metropolitan Detroit (Wayne, Oakland, and Macomb) The socioeconomic characteristics and racial composition of the Opportunity Zones The weakness of the Opportunity Zone legislation Who benefits from the Opportunity Zone legislation? Are Opportunity Zones for billionaires? Do Opportunity Zones exclude minority investments? Conclusion 6 Black and Hispanic Underrepresentation in Business Ownership in a Majority-Black City Introduction Black-owned businesses nationwide: previous studies Characteristics of Black-owned businesses nationwide Black business ownership in Metropolitan Detroit The state of Black-owned businesses in Metropolitan Detroit more recently Data from the most recent survey on Black-owned businesses in Metropolitan Detroit with paid employees Data Characteristics of Black-owned businesses with paid employees The type of Black-owned businesses with paid employees The most recent data on the largest Black-owned businesses in Detroit and its suburbs Black-owned auto dealerships and the significance of suburban location Summary What Black business owners want from the Mayor of the City of Detroit Hispanic-owned businesses nationwide Hispanic-owned businesses in Metropolitan Detroit The state of Hispanic-owned businesses in Metropolitan Detroit more recently Data from the most recent survey on Hispanic-owned businesses in Metropolitan Detroit with paid employees Data Characteristics of Hispanic-owned businesses with paid employees The most recent data on the largest Hispanic-owned businesses in Detroit and its suburbs Summary Analyses of Paycheck Protection Program loans to Black-owned, white-owned, and Hispanic-owned businesses Which businesses located in municipalities in Metropolitan Detroit received PPP loans? Conclusion 7 Racial Inequality in Student Academic Achievement Levels Introduction Calculating the national average test scores Detroit public schools community district Educational opportunity overview Selected suburban Detroit school districts Allen Park school district Educational opportunity overview Dearborn school district Educational opportunity overview Eastpointe school district Educational opportunity overview Lincoln Park school district Educational opportunity overview Livonia Public School district Educational opportunity overview Novi Community School district Educational opportunity overview Oak Park school district Educational opportunity overview Pontiac City school district Educational opportunity overview Romulus Community School district Educational opportunity overview Roseville Community School district Educational opportunity overview Southfield Public School district Educational opportunity overview Taylor school district Educational opportunity overview Troy school district Educational opportunity overview Warren Consolidated School district Educational opportunity overview Summary The racial segregation of school districts The racial segregation of Black and Hispanic students in Macomb County Racial segregation between Hispanic students and non Hispanic white students The racial segregation of Black students from white students in Oakland County The racial segregation of Hispanic students from non Hispanic white students in Oakland County The racial segregation of Black students from white students in Wayne County The racial segregation of Hispanic and non Hispanic white students in Wayne County Selected highly segregated school districts and charter schools in Wayne County and the academic consequences Conclusion 8 Unequal Exposure to Crime in the City of Detroit Introduction The neighborhood effects conceptual framework The influence of distance and knowledge of nearby neighborhoods matter Neighborhood air pollution and crime incidents Foreclosures and crime Health and wellbeing in neighborhoods and crime Data sources Method of analysis Results Crimes in the City of Detroit by neighborhood socioeconomic characteristics in 2015 Crimes in the City of Detroit by neighborhood socioeconomic characteristics in 2020 and changes since 2015 Conclusion 9 Solving the Problem of Extreme Race and Class Inequality Introduction In search of the geography of opportunity: evidence of Black and Hispanic suburbanization between 2010 and 2020 Black and Hispanic populations in selected Detroit suburbs The focus of this chapter The study areas Barriers to achieving geography of opportunity The geographic distribution of loan applications Racial disparities in mortgage loan denial rates in selected suburbs in Detroit Loan denial rates by socioeconomic position and characteristics Home mortgage loan denial rates by type of loan Racial inequality between Blacks and whites in Detroit’s selected suburbs and in the City of Detroit Racial inequality in the poverty rate between Black and white households Racial inequality in the poverty rate between Black and non Hispanic white households Racial inequality in terms of median household income Racial inequality in the occupational structure Black inequality in the occupational structure Black inequality in the educational attainment in selected suburbs of Detroit and the City of Detroit Black inequality in homeownership Hispanic inequality in the poverty rate Conclusion 10 Conclusions Data limitations The Black and Hispanic population undercount and the overcount of the white population The Census Bureau identifying Middle Eastern population as white References Index Detroit is the first city of its size to become bankrupt and some policy makers have argued that, since then, it has entered a ‘new beginning’. This book critically examines the evidence for and against this claim. Joe T. Darden analyzes whether Detroit’s patterns of race and class neighborhood inequality have persisted or whether investments have led to improvements in academic achievement, homeownership, employment, and reductions in poverty and violent crime. He measures, quantitatively, the benefits and disadvantages of staying in urban Detroit or moving to the suburbs, and provides evidence to answer whether Detroit, after bankruptcy, is becoming an inclusive city.Detroit is the first city of its size to become bankrupt and some policy makers have argued that, since then, it has entered a ‘new beginning’. This book critically examines the evidence for and against this claim. Joe T. Darden analyzes whether Detroit’s patterns of race and class neighborhood inequality have persisted or whether investments have led to improvements in academic achievement, homeownership, employment, and reductions in poverty and violent crime. He measures, quantitatively, the benefits and disadvantages of staying in urban Detroit or moving to the suburbs, and provides evidence to answer whether Detroit, after bankruptcy, is becoming an inclusive city