Demolitions an ugly reality for cities losing people

WASHINGTON — Mayors say demolishing abandoned homes is a policy of last resort. But for many cities around the country, it's also a survival strategy.

"We've got a massive amount of new investment that is coming into the city, but vacant and abandoned buildings serve as a tremendous drag on all the other positive things you have going on,'' Niagara Falls, N.Y., Mayor Paul Dyster said. "People who are potential investors, people who are potential residents, if they see a third of the buildings are abandoned, that's the image they take back with them.''

Mayors from all over the country gathered in a hotel conference room this past week for a standing-room-only discussion on rehabbing and demolishing abandoned properties.

The discussion, part of the winter meeting of the U.S. Conference of Mayors, highlighted a problem that continues, despite recent improvements in the national economy.

For cities in the Northeast and Midwest that have lost significant population over the last several decades, demolitions have become a necessary component of neighborhood preservation and revitalization.

In other parts of the country, problems with abandoned homes are more tied to the sub-prime lending crisis.

Mayor Jorge Elorza of Providence, R.I. has about 600 abandoned properties in his city. The city's population has dropped from about 250,000 to 180,000.

"There are properties that have been vacant for five, six and seven years,'' Elorza said. "That's just unreasonable. And I think we all agree we dropped the ball. We need a comprehensive approach to address this.''

Providence demolishes only about five to 10 properties annually, Elorza said, because the city's homeless population and 5% vacancy rate demonstrate strong demand for housing.

"We demolish very little,'' he said. "We only use it as a last-case scenario."

In Rochester, N.Y., where the population has declined from 300,000 to about 210,000, "you don't need as many houses as you used to need,'' Mayor Lovely Warren said.

Most cities in upstate New York are losing population. And although the state is slowly gaining population, Florida recently passed New York as the third most-populous in the nation.

Rochester has about 200 homes targeted for demolition among the 1,300 that have been vacant for more than a year, according to the city.

Warren said part of the reason is that vacant single-family homes often don't appeal to empty-nesters and young professionals looking to buy or rent.

"You have to prepare your housing stock for what your community is telling you,'' she said. "And that's going to take some time.''

Mayors agree that rehabbing or demolishing homes that have become eyesores is the only way to prevent further deterioration of a neighborhood.

"One blighted building, for example, in a residential neighborhood can scare off a dozen people who move to the suburbs because they fear the deterioration of the street,'' Dyster of Niagara Falls said. "They are a target for arsons. One arson fire can cost you more in fire overtime, let alone the risk of injury, than the cost of demolition.''

Although rehab is preferred, the economics may not work for long-vacant homes needing major work.

And demolishing homes isn't cheap.

Ernie Davis, mayor of Mount Vernon, N.Y., estimated that a residential demolition in his city neighboring the Bronx costs between $50,000 and $55,000 because older homes usually have asbestos requiring special treatment for removal.

"It's a nightmare,'' Davis said. "I would say we have in various stages of disrepair about 200 buildings.'' Abandoned homes also are a drain on the city's tax revenue, he noted.

Since 2008, Congress has approved nearly $7 billion for the Neighborhood Stabilization Program, designed to help cities, counties and states deal with the collapse of housing prices that led to the Great Recession. Money from the program can be used for demolitions, although that's not the program's main objective.

The program last received money in 2010, and there are no plans for more.

The only other source of federal funding for cities to demolish buildings is the Community Development Block Grant program, which can be used for a variety of purposes. CDBG funding has been flat at around $3 billion annually in 2014 and 2015, down about $1 billion from 2010.

Many cities are using non-profit land banks as part of a strategy that acquires properties before they deteriorate and rehabs them or sells them to neighborhood redevelopment groups. The land banks also can, in many cases, pay for demolitions.

"What we learned in the past is that you can't do spot development,'' Warren said. "So you don't want to demolish a house and then build a house next to a drug house, a boarded-up house. You want to really be able to transform neighborhoods in a real way so it's safer for the families who are moving in there.''