Mayor of Gary is betting on a brighter future : Plans to turn the steel town into a gaming resort failed. A ‘marine Disneyland’ is now in the works.

“Someplace special.” That’s what the banner downtown says. Just in case you need a little help figuring this thing out.

The main street is lined with boarded-up and gutted buildings, a few drunks and not much else. Down the road is the empty shell of what used to be a Sheraton hotel. It was the only major hotel in a city of 140,000 that doesn’t have a department store or movie theater. It sits across the street from an impressive but seldom used convention center. And next to the empty hotel is a government building with a fancy smoked-glass sky walk that ends in midair.

There’s another sign, this one south of the city as you’re driving in. “Gary is stressing the positive,” it says.

That’s for sure. With all the signs and the audacious talk at City Hall these days, you’d almost think this old steel town was trying to will itself back into prosperity.

After hitting rock bottom in the last decade because of steel industry restructuring and white flight, Gary, Michael Jackson’s hometown, is trying to bounce back with plans as outsized and glitzy as a Jackson stage show.

Mayor Thomas V. Barnes spent much of his first two years in office trying to turn this one-industry town into a glittery Midwestern casino resort. But the Legislature shot down his dream by failing to pass a bill legalizing gambling. Then Barnes came back in March with an ambitious $100-million lakefront development plan slated for the same industrial land as the casinos.

The way he envisions it, in five years this struggling city will have a 250-acre “marine Disneyland” on Lake Michigan with an aquarium, a yacht club, a marine museum, retail shopping, restaurants and live theater.

“We are planning a world-class Gary tourism center that will be second to none,” he told reporters.

All this in a grim and gritty city that until now has considered the opening of a new Wendy’s restaurant something to celebrate.

Groundbreaking for the first phase of the lakefront project is set for August, with the more highly touted features--such as the aquarium and stores--slated for later phases, said Arlene Colvin, the city’s director of physical and economic development.

Founded in 1906, Gary was named after the president of U.S. Steel, the presence of which was the city’s primary reason for existing. The steel company, now USX, is still the city’s largest employer but it employs only about a third of the workers it once did--about 8,000 as opposed to 25,000 eight years ago.

The declines, along with white flight, have devastated the city. Its population has dropped from a peak of 178,320 in 1960 to about 140,000 today.

“There’s very little left of Gary, commercially, industrially and in every other respect,” said Leslie Singer, a professor of economics at Indiana University Northwest.

As the steel industry has slowly revived and restructured in recent years, USX has increased its production, but because of automation the work force has been reduced.

No further erosion of steel jobs is expected. Still, Barnes’ grandiose plans for the city’s comeback have been met with a certain amount of skepticism in some quarters. Also, the mayor has been criticized for focusing on grand multimillion-dollar tourist attractions to the exclusion of more mundane but necessary economic development projects, the bread-and-butter businesses that help make a city a city.

“The bread-and-butter is being attended to,” argued Donald Thompson, Gary’s economic development director.

Another potential boost is the city of Chicago’s proposal to build a $4.9-billion airport on that city’s far south side, a 13-minute drive from Gary.

“That (would) be an enormous boost,” said Singer, the economics professor, noting that the spinoff jobs and businesses would spill into the depressed city. “That in itself would turn things around,” he said.

Gary and Indiana officials had been studying the feasibility of building a major airport in northwest Indiana, possibly by expanding Gary’s small municipal airport, but Chicago’s proposal--though controversial because it will require the destruction of thousands of homes--has stolen that thunder.

Whether Barnes’ grand revitalization plans work or not, at least it appears that Gary’s long economic slide finally has stopped.

“There’s not much more it can slip,” Singer noted.

Times researcher Tracy Shryer contributed to this story.