Rising demolition costs in Cleveland area alarms Special Inspector General

Posted at 8:11 PM, May 01, 2017
and last updated 2017-05-01 21:09:31-04

The Special Inspector General for the Troubled Asset Relief Program is questioning the rising costs of home demolitions in the Cleveland area. 

According to a quarterly report, in just 2 1/2 years the average cost rose 66 percent. 

Walking around Taylor Road, in East Cleveland, the presence of abandoned homes casts a shadow over the neighborhood. 

"It doesn't stop, every street is like this," a resident who goes by Timmy said.
Timmy tells us the poorly boarded up window and doors attracts unwanted guests. 

"If you look at any of these abandoned houses. Why are the couches and beds in the backyard?" ask Timmy.

In the last 2 1/2 years, the federal government has allocated money for demolition through its Hardest Hit Fund. Cuyahoga County received a bulk of the funds, about $52 million. So far the county has spent around $34 million. 

“We’ve demolished about 1,900 with these funds, ” said Cuyahoga Land Bank COO, Bill Whitney.

However, in the report, the Special Inspector General says a rise in demolition cost in the Cleveland area has set off alarms in Washington. 
“Here in Cleveland we saw a cost rise of 66 percent, that’s pretty significant in such a short period of time,” said Christy Goldsmith-Romero. 

That means demolition went from an average $9,000 per house to $15,000.

The report also finds that due to a lack of regulatory policies, in states like Ohio, the HHF program is vulnerable to fraud. 

"Our job is to make sure these funds are not a cash cow to anyone," Goldsmith-Romero said.

But Bill Whitney said new factors, not fraud, explain the rise in demolition costs. 

“The most expensive and one of the nicest the program offers is up to $6,000 of landscaping that remains after the demolition,” he said.

He also cites the removal of household trash as an additional expense. With all of that accounted for, Whitney says the increase is really 11 percent or $800.

“With those factors incorporated, I think that is very good,” he said.