Many readers expressed outrage after The Buffalo News published an analysis on how the City of Buffalo spent just under $4.3 million in federal Housing and Urban Development funds to rehabilitate 10 low-to-moderate income homes that sold for an average of $100,000 each.
A couple of the houses are in historic districts, and efforts were made - in one of those cases - to retain elements such as original wood flooring, ceramic tiles and lead glass windows. (You can see the houses at 160 Brunswick Blvd. and 245 Dearborn St. through our photo galleries.) But otherwise, there's nothing particularly noteworthy about the rehabbed houses. Generally, it was the environmental clean-up costs and historic locations that drove up the rehabilitation costs, as well as the size and condition of the properties, News' reporter Susan Schulman found.
In one case study, Schulman found that the Buffalo Urban Renewal Agency spent $523,600 in federal funds to fix up a house that is now selling for $137,750. In another case study, $560,000 was spent to rehab an almost 100-year-old house that sold for $115,000.
Many readers had questions about how this happened. We collected a few and caught up with Schulman about her investigation:
From Robin Thoin Faltyn and Steve Kahler: Would it have been cheaper to demolish and start from scratch?
Schulman: It depends on the size of the house you are building. There was a house at 174 East St. in Black Rock that was being considered for rehab, but was instead demolished, and a new 1,492-square-foot house was built on the lot. Total cost to demo the old and rebuild the new was $334,560. That's less than the average rehab of $430,000. But it's also smaller. The city has been rehabbing houses that average 2,340 square feet.
From Tim Hunger: Lots of unnecessary structural changes, removing bay windows, stripping architectural elements and adding modern plastic and vinyl. ... Was all that necessary to rehab the house?
Schulman: I'd say don't assume there were unnecessary changes. We're told these houses were a mess, and the "before" pictures show that. Demolition-worthy. Aside from structural issues, there are environmental ones. Lots of lead and asbestos that had to be removed. Some houses had lead and asbestos throughout, including in the windows and the siding. The environmental laws are more strict when government rehabs a house than when individuals fix up their own homes.
From Sue Knott and Alexis Banks: Who actually bought these houses? Who is spending $100,000 to live in these neighborhoods?
Schulman: The houses are sold to first-time homebuyers who meet low-and-middle income requirements established by the U.S. Department of Housing and Urban Development. The homebuyers must agree to live in the houses for 15 years. Six of the 10 houses have small rental apartments in them, providing some rental income to the homebuyer. The houses are located in Black Rock, South Buffalo, Hamlin Park, Fillmore Avenue and in the Masten District, between Main Street and Jefferson Avenue within a mile of Buffalo Niagara Medical Campus.
From Frank W Kolbmann and Dawn Vincent: Where did the money come from and who authorized it? How does this stuff get approved?
Schulman: The money comes from HUD and goes to the Buffalo Urban Renewal Agency. Rehabs are proposed by community organizations to BURA housing staff, or identified by BURA housing staff itself. The community organizations serve as developers, but with over sight from BURA housing staff, which helps to establish scope of the project — everything from the number of units to the number of kitchen appliances. All projects must be approved by the BURA board, which is composed of Buffalo city and BURA officials and headed by the mayor, Byron W. Brown.
From Tammy Craft: Why can't they use volunteers like Habitat For Humanity does?
Schulman: The Brown administration is developing a new rehab plan that we're told will include a Habitat for Humanity component.
From Sue Knott: How much does Habitat for Humanity spend on a rehab?
Schulman: I don't know. We'd have to check with Habitat on that.
From Robert F. Skurzewski: The contractors got paid and made a profit of some kind. Did they return to do more work? Would they come back if this program was to continue?
Schulman: Two contractors who were hired to gut and repair the houses say they did not make huge profits on the work.
From David Kline: So who are the companies doing these renovations?
Schulman: Lamparelli Construction of Cheektowaga or Burke Brothers Construction of Hamburg were the general contractors on the 10 houses. While the Syracuse and Rochester housing agencies work with 10 to 15 general contractors, Buffalo generally has two or three bidding for its housing rehab work.
From Karlie Jones: Who was in charge of hiring the contractors?
Schulman: Community organizations, working with BURA, serve as developers on these project, and I believe they put out the bids and hire the contractors. BURA oversees it all.
From Mike Czajkowski: How do you get a contract to rehab a house for the City of Buffalo?
Schulman: It's publicly bid.
From Brian Conover: How does it costs more to rehab a house in the city for more than it costs to buy a new built house in Amherst, N.Y.?
Schulman: I thought one of the contractors, Paul Lamparelli, did a good job explaining that. Remember, these houses are demolition-worthy, but instead of being knocked down, they are being built back up — pretty much by hand. Foundations and the basic structure of the house — the perimeter, roof trusses, exterior framing and exterior walls — are being retained, Lamparelli said. The rest is being taken down by hand, with environmental monitors on site the entire time because of the lead and asbestos, he said. Then, the house — with average size of almost 2,400 square feet — gets built back up. Also, a couple houses were rehabbed in historic Buffalo neighborhoods, which also drives up costs.
From Justin Masucci: Wasn't this one of Tony's scams on "The Sopranos"?
Schulman: Sorry, I never saw the show. LOL.