The real answer is that young people move to Peoria so they can get a job.

It's not just that people took advantage of cars to build houses with bigger yards further from where they did their shopping on Main Street, or even that they switched to doing their shopping at the Walmart out on the fringes; it's also that they took advantage of cars to leave their houses where they were and do their shopping in Peoria. They mostly couldn't do that in 01912, even if they did have a Ford. In 01912 nearby farmers would go to Galesburg to do their shopping and ship their corn by rail; now the farmers have mostly been replaced by tractors, and the remaining farmers can just as well drive their pickup to Davenport, an hour away on I-74, for the wider selection. Or order from Amazon.

The article focuses a bit on property tax rates and tax assessments, but those are sort of a distraction, because they just have to do with how the paying of the costs is distributed. The problem is not that Galesburg is full of fat cats not paying their fair share to maintain common infrastructure, or that it's some kind of tax haven where everything well-maintained is privatized. (To be fair, the article does explain this.) The problem is that people in Galesburg are poor, because the economy left, so they can't afford to maintain the infrastructure they're using. An extra US$1200 per family per year to maintain the roads wouldn't be a significant burden in a place with a prosperous economy.

Shrinking that infrastructure by redirecting development to downtown is one way to accommodate that reality, but it will probably just accelerate Galesburg's decline. The reason kids aren't playing in Main Street anymore is that it's US Highway 150, full of cars, truck exhaust, truck noise, and speeding trucks. In 01912 https://www.youtube.com/watch?v=XgucvsVEigA it was full of horse-drawn carriages with the occasional Ford or streetcar, and no trucks. If you give up your "big houses with big yards out on the edge of town" to move to downtown Galesburg, you aren't going to get a street where you can have a pleasant stroll down the middle of Main Street for relaxation. You're going to get semis honking air horns at you if you try it.

Downtown business districts are primarily about information delivery. The reason that commercial real estate is valued by "location, location, location" is that people will buy from your store if they see it when they walk by, and they won't if they don't. If you're selling your stuff on Amazon, MercadoLibre, Etsy, or eBay, there's no benefit to having big plate glass windows in a high-pedestrian-traffic area; you might as well be in a warehouse out on the edge of town or on the 7th floor of an apartment building. But if you're near FedEx's national air distribution hub, you might have a significant advantage.

In the particular case of roads, Galesburg would be able to afford road maintenance if the roads were used by pedestrians, bicycles, four-wheelers, or maybe even cars, but when they're used by SUVs and semis, they get potholes pretty quickly. But truck driving is one of the few decent jobs left in Galesburg, so you can't just ban it.

https://en.wikipedia.org/wiki/Galesburg,_Illinois#Demographi... shows how Galesburg has been slowly shrinking since 01970.