UPDATE:
After saving up enough gold, I repaired all damages, which took the food / happiness from -14 / -48 to 15 / -30.
I then upgraded it to a city, which made no changes to these yields.
After purchasing a Radio Station, City Park and Department Store, the values improved to 57 / -2.
I then purchased a Port, which causes a further -4 unhappiness, but provides an extra resource slot.
I then slotted 4 Horses, and voila, the city is functional again!
It cost about 10k of Gold, but now the citizens are happy and the City has 56 population
After saving up enough gold, I repaired all damages, which took the food / happiness from -14 / -48 to 15 / -30.
I then upgraded it to a city, which made no changes to these yields.
After purchasing a Radio Station, City Park and Department Store, the values improved to 57 / -2.
I then purchased a Port, which causes a further -4 unhappiness, but provides an extra resource slot.
I then slotted 4 Horses, and voila, the city is functional again!
It cost about 10k of Gold, but now the citizens are happy and the City has 56 population


