Two Detroit representatives in Congress recently sent Michigan officials a letter urging greater oversight of the state’s federally funded demolition program.
The program, which is taking place in cities across the state, including Detroit and Flint, has faced years of criminal probing since it came under scrutiny in 2015 over concerns about bidding practices and rising costs.
A set price program for the property demolitions that was put in place in 2014 was a core issue of the investigation. The city was looking for contractors that could demo 800 properties within two months. Three of the four local demolition contractors participating in negotiations before the public bidding period—Adamo Group, Homrich and MCM Demolition—were the only companies that bid on the work after the public bid period. They were ultimately awarded the contracts. Bierlien was the other company involved in the meetings.
The investigation looked into whether the city engaged in fraud or corruption by holding the meetings with these contractors.
January presented the program’s latest saga of issues, when the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) issued subpoenas seeking two years’ worth of documentation from certain contractors over dirt used to fill holes, according to the Detroit News. As reports of potentially contaminated soil have surfaced, the inspector demanded demolition firms produce records to confirm where their backfill dirt was coming from, who trucked it to sites in Detroit and where it was being dropped off.
Detroit Mayor Mike Duggan defended the city, saying that no city agency has been subpoenaed over the dirt and officials cooperated with every investigation, the Detroit News reports.
In their letter to the Michigan Department of Environmental Quality and Michigan State Housing Development Authority, Reps. Rashida Tlaib and Brenda Lawrence, both Democrats, outline their concerns over the statewide program, which is being financed primarily by the Hardest Hit Fund.
“The potential use of contaminated and unverified sources of dirt being used to fill these demolition sites presents an alarming lack of oversight that could have public health ramifications for thousands of Michiganders,” the letter says. “Unfortunately, recent reporting indicates that the Blight Elimination Program is not functioning the way it should.”
In November of 2017, SIGTARP released a report outlining the concerns it had with the Blight Elimination Program, which focused on the risk of asbestos exposure, illegal dumping and contaminated soil from demolitions in Flint and other cities. SIGTARP worked with the Army Corps of Engineers to conduct field inspections of multiple properties in various stages of demolition, where they found “a disturbing lack of oversight done by state authorities in Flint regarding this program,” the letter states.
Their investigation uncovered five main findings, “which illustrate the grave lack of oversight,” according to the letter. Those were:
- Asbestos removal appears to have been mismanaged by the local land bank continuing through all contractors involved with asbestos.
- It is unclear whether material placed into holes was clean and provided in accordance with contract requirements.
- Contractors may have allowed risks on properties with significant amounts of hazardous material in attempt to keep project costs beneath the $25,000 cap.
- All the agreements and execution documentation were lacking in quality assurance.
- The state, city and local land bank performed redundant inspections of winter grade and final grade, while no other physical inspections were documented.
The letter continues to request the Michigan Department of Environmental Quality provide an update on the oversight it has conducted on the Blight Elimination Program across the state.
A spokeswoman for the Michigan State Housing Development Authority told the Detroit News that the agency has taken recent health and safety concerns seriously by implementing additional protections, which include increased site inspections, more contractor training and dirt testing.
The program has resulted in the demolition of more than 11,000 houses in Wayne County alone.