Auto Crisis Hits Home In Middle America
Obama Point Man Visits Flint, Mich.

By Dana Hedgpeth
Washington Post Staff Writer
Saturday, May 9, 2009

FLINT, Mich., May 8 -- For two days, President Obama's point man on helping communities hit hard by the auto crisis has toured Michigan to hear what the federal government might do. At a community college in this downtrodden city, Ed Montgomery heard tales of woe, one after another, from neighborhood leaders and business owners attending a two-hour, invitation-only session.

A construction company owner told him how his business took a hit as dealerships stopped opening facilities. Union leaders told of laid-off auto workers unable to pay mortgages and other bills. A school official said she was dealing with cutbacks in her budget. Montgomery, who traveled with representatives from several federal agencies, also heard two dozen community leaders in Warren, before ending his trip in Detroit.

Speaking to Warren community leaders, the White House's emissary said any revival "starts with companies and moves out to suppliers, to people in the health-care industry. It affects the hospitals, the schools. It affects housing all through the community. It is very clear we need to think about comprehensive solutions."

His stop in Flint brought the scale of the challenge into focus. Few towns have been hit harder by the downturn in the auto industry.

Flint has gone from having 80,000 GM workers at its peak in the 1970s to roughly 7,000. Left behind are roughly 1,400 acres of concrete slabs, overgrown with weeds, that were the sites of auto plants long ago torn down.

"We are the epicenter of the auto crisis," said Flint Mayor Michael Brown, whose father helped build a Buick plant.

The mayor wants Montgomery to help navigate the bureaucracy to get former contaminated sites, known as brownfields, cleaned up so he can get them into developers' hands. He says one developer is interested in turning Buick City into a transportation hub for agricultural goods. He declined to name the developer.

The industry's downturn is ripping through the community in other ways as well.

For starters, the city has a $10 million budget deficit. Unemployment is at 15.3 percent. Crime is high. More people are living below the federal poverty line. There's been an uptick in cases of reported child abuse and neglect. More families are asking for food stamps and help paying rent, utility and medical bills. Foreclosures are rampant and so are bankruptcies.

Brown asked Montgomery for help to pay for the more than 80 police officers, firefighters and housing code inspectors he recently laid off. He'd like federal help to tear down an 86-year-old high school and rebuild a new, high-tech one in its place. He wants to protect the pensions and health care plans of laid-off workers. And he is pushing to keep open the remaining GM plants in town -- including one that assembles engines for the company's new battery-powered Volt.

But he's also a realist and knows that the town cannot depend on new brands to keep the few thousand workers the town has employed, so he wants Montgomery to also help Flint attract "green" industries. Flint area economic development officials said they recently went to Shanghai to try to lure two Chinese companies to set up facilities in Flint. But progress is slow.

"It feels like we're on quicksand," Brown said. "Nothing is assured until we get through this crisis."

Still, many are hopeful that Montgomery can get things done.

"I classify him like the FEMA director," said Duane Zuckschwerdt, director of United Auto Workers Region 1C, which covers 11 Michigan counties, including the cities of Flint, Jackson and Lansing. "He's here to help a community that's been devastated by disaster. That's us."

Others are just trying to deal with the day-to-day.

In Warren, a town of roughly 130,000 about an hour from Flint, Mayor James Fouts asked Montgomery to help him use a $5.8 million grant from the Department of Housing and Urban Development to build what he said is a much-needed library, community center and police station in the city's poorer southern edge. He also wants money to fix aging and broken water pipes and pot-holed roads.

And with an unemployment rate hovering at about 20 percent, he's worried about losing the 30,000 jobs at the GM Technical Center, which does research and development, if the company files for bankruptcy protection.

City officials are concerned that if GM goes in bankruptcy protection, the city could lose the $8 million in annual taxes it collects from the company.

"We need to give people hope that the city cares," Fouts said.

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