Friday, May 24

A city built on steel seeks to reverse its decline

Gary, Indiana was once a symbol of American innovation. Home to US Steel’s largest steel mill, Gary churned out the product that built America’s bridges, tunnels and skyscrapers. The city has reaped the benefits, with a thriving downtown and vibrant neighborhoods.

Gary’s smokestacks still stand prominently along the sandy shore of Lake Michigan, starkly juxtaposed between the eroding dunes and the towering skyline of Chicago to the northwest. But now they represent a city looking for a new beginning.

More than 10,000 buildings are abandoned and the population of 180,000 has fallen by more than half in the 1960s. Poverty, crime and an ignominious nickname – “Scary Gary” – discourage private investors and potential homeowners.

As U.S. Steel finds itself at a crossroads — a planned takeover would place it under foreign control — so does the city named after the company’s founder who helped build his empire. A new mayor and planned revitalization projects have reignited hope that Gary can forge an economic future beyond steel, the kind of rebirth that many Midwestern industrial cities have managed to achieve.

In theory the potential is there. Gary is located in the third largest metropolitan area in the country, straddling major railroad crossings and near a seaport. A national park, Indiana Dunes, is a popular destination for park-loving tourists and curious motorists.

“We have the recipe for success,” said Eddie Melton, the newly elected mayor. “We need to change the narrative and make it clear to the world that Gary is open for business.”

A minor league ballpark and casino are among the construction projects city officials point to as success stories. But they failed to generate the kind of lasting economic effects and spillovers hoped for, said James B. Lane, a history professor at Indiana University Northwest and a Gary historian.

“The problem with all these projects is that they haven’t led to a multiplier effect of shops and businesses around them,” Dr Lane said.

Other efforts have failed. The city agreed to the sale of its convention center to a technology company that promised thousands of jobs, but later sued the company after the company defaulted on its contracts. A multibillion-dollar plan to create a theme park that capitalized on Gary’s fame as the birthplace of the Jackson Five was scuttled in the 1990s.

“We definitely missed the opportunity to turn this into a Dollywood, a Graceland,” said Chuck Hughes, president of the Gary Chamber of Commerce.

US Steel’s presence in Gary is significantly reduced. Gary Works, U.S. Steel’s largest plant, employs about 3,700 people, up from more than 30,000 at its peak. But local businesses still rely on the economic activity generated by the plant, which remains one of the city’s largest employers.

One such business is the Great Lakes Cafe, a diner right outside the gates of Gary Works. Each morning, steelworkers wearing orange jumpsuits stop by the restaurant, which has signs expressing support for the United Steelworkers union, to enjoy plates of hash browns, biscuits and gravy before starting the workday.

“We love US Steel,” said Cindy Klidaras, the owner of the restaurant, which opened in 1994.

Economic research does not point to a clear solution for Gary’s renewal, but it suggests crucial elements such as investments in infrastructure and making the city a more physically attractive place to live.

Melton’s election was celebrated by many as a new step forward. Kia Smith, a small business owner who has lived in Gary all her life, said the mayor’s focus on transparency was a positive sign for businesses in a place that has long faced corruption. Ms. Smith, whose grandfather worked in the steel mill, said the city needed to diversify its economy beyond steel.

“No one owns Gary,” said Ms. Smith, 43, who owns and operates a health food store and restaurant business. “We all own Gary.”

Beautification and restoration work is underway. Mr. Melton’s administration has begun demolishing old buildings to attract developers who can build new homes and other structures on the many vacant lots. One idea is to make Gary a viable alternative to Chicago, where rents have skyrocketed. Jim Wiseman, a lifelong resident who has worked in the local construction industry for more than 40 years, said his company has begun cooperating with the new administration, recently razing 15 buildings.

Mr. Wiseman’s childhood home, in the hard-hit Aetna neighborhood, is among those slated to be demolished. “Demolition is a way to change the community forever,” he said. “I hope to see a resurgence of new growth and housing for the community as we change things for the better.”

The South Shore Line, a commuter rail line connecting Chicago with cities in northwest Indiana, will open a second set of tracks between Gary and Michigan City to the east. Gary/Chicago International Airport received $6 million in federal funding and added more cargo capacity in 2023, with the goal of serving as a logistics hub for tenants like United Parcel Service. In December, Gov. Eric Holcomb announced a $127 million grant to improve Interstates 80 and 94, which run through Gary, with funding from the bipartisan infrastructure bill.

However, the challenges are steep.

Growing up in Gary, Kamal Minkah knew it as a thriving city. Things began to change in the late 1960s, when many white residents left, and continued with the first widespread layoffs at Gary Works in the early 1970s.

Mr. Minkah left to join the Air Force in 1980, returning in 1991. Gary was unrecognizable.

“It was like an empty feeling,” said Mr. Minkah, 60. “It’s like the city has collapsed.”

Today, Mr. Minkah is a police officer assigned to the Gary school system and runs a karate school. He cited Gary’s proximity to Chicago and low housing costs as strengths.

Political isolation is another difficulty. Gary’s demographics — the city is more than 80% black and heavily Democratic — put it at odds with Indiana’s majority-Republican legislature. Lawmakers blocked initiatives that would have allowed Gary to expand its tax base and offered him little state funding, citing corruption concerns. At the same time, the Illinois government had little incentive to better connect Chicago to an Indiana city.

Paul Helmke, the former Republican mayor of Fort Wayne, said a quirk of Indiana state tax law helped his city, but not Gary, recover from declining manufacturing. Gary was a smaller, Democratic-majority city within a larger, more conservative county, which Indiana law controlled its ability to handle taxes. It couldn’t increase its tax base without county approval.

“Gary was a prisoner of what other cities in his county wanted to do,” Helmke said.

Other cities offer contrasts and possible lessons.

About 450 miles to the southeast, Pittsburgh’s steel heritage remains a key part of its identity, even if the city hardly recalls the days of heavy industry. Chic bars, coworking spaces and university hospitals stand where steel mills once lit up the night sky.

Unlike Pittsburgh, Gary does not have a major research university, a key driver of economic transformation. Melton said his administration worked closely with Detroit’s mayor to understand how that city had worked to revitalize its economy after losing much of its domestic auto manufacturing.

A useful model for Gary might be Erie, Pennsylvania, said John Lettieri, co-founder of the Economic Innovation Group, a nonprofit research organization. Like Gary, Erie depended heavily on manufacturing and suffered when those jobs were moved overseas. But a combination of business and political leadership and investment from one of the city’s largest employers, Erie Insurance Group, led to a significant turnaround.

There, Erie Insurance worked with a group of local business owners, development organizations and others to revitalize the waterfront, investing $50 million with outside partners in 2020. This project was spurred by a federal program that offers tax breaks for development of areas in difficulty. The company also added a $147 million building to its campus in 2021.

But most important to Gary, Lettieri said, is the continued focus on making the city safe and livable. “When you have a declining population and a high crime rate, these are the prerequisites that the public sector must address before the private sector steps in,” he said.

Although Gary has long been associated with decay, the residents who remain, black and white, see a chance for renewal.

Mr. Wiseman is among the hopeful. His mother worked in a steel mill in the 1940s and 1950s and felt loyal to the city, staying put when many other whites left, a migration that occurred around the 1967 election of Richard G. Hatcher, one of the first black mayors of a large American city. Before he died, he made his son promise to help her get Gary back to where he was: a place where people want to live.

“My absolute dream is to see Gary thrive in my life again,” Mr. Wiseman said.