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FinanceDetroit

Fixing up Detroit will cost almost $2 billion, report says

By
Tom Huddleston Jr.
Tom Huddleston Jr.
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By
Tom Huddleston Jr.
Tom Huddleston Jr.
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May 28, 2014, 1:44 PM ET

FORTUNE — A government-backed task force recommends spending nearly $2 billion over several years to cure Detroit’s dilapidation.

The Detroit Blight Removal Task Force, which surveyed nearly all of the properties in Detroit, told city and federal officials on Tuesday that as much as $850 million should be spent to either raze or revamp roughly 80,000 structures in the city’s neighborhoods.

Roughly 22% of the 380,000 properties surveyed have evidence of current or future blight, according to the task force that was convened last year by the Obama administration. In its report the task force said most of the 78,506 blighted neighborhood structures will need to be removed while more than 6,000 vacant lots also require “immediate attention” after having been used as neighborhood dumping grounds for trash and other items.

MORE: Detroit proposes a lose-lose bankruptcy plan

Meanwhile, the task force says cleaning up or removing the city’s larger industrial sites that have become run-down could require up to $1 billion, which when added to the $850 million needed to deal with the city’s blighted buildings, plus any potential additional spending, brings the total cost of cleaning up Detroit to almost $2 billion.

Dan Gilbert, the founder and chairman of Quicken Loans and the owner of the Cleveland Cavaliers, is leading the task force. He said Tuesday that “blight is a cancer,” and he expressed confidence that the city would find the money necessary to fund blight removal, according to The New York Times.

The task force believes Detroit, the nation’s largest bankrupt city, can remove all signs of blight within five years. So far, the city has lined up more than $450 million in funding to go toward blight removal while another $88 million in federal funds could become available. And, the task force says, an additional $368 million could also be pulled out of the restructuring plan put together by Detroit’s emergency manager, Kevyn Orr, pending the approval of a bankruptcy judge.

MORE: What housing slowdown? Toll Brothers’ sales leap

The task force says it has “asked stakeholders across all sectors” for ideas on how to gain access to additional funds to go toward blight removal.

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By Tom Huddleston Jr.
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