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Federal Agencies Investigating the Rising Costs of Detroit's Blight Program

Detroit's aggressive blight reduction strategy, to demolish vacant homes by the thousands, is coming under scrutiny for rising costs. The FBI and the U.S. Inspector General are investigating.
May 31, 2016, 11am PDT | James Brasuell | @CasualBrasuell
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University of Michigan School of Natural Resources and Environment

Matt Helms reports on the latest details of an expanding federal investigation in Detroit into increased costs in the city's demolition program. First, for those who missed it:

The FBI is assisting the U.S. Special Inspector General for the Troubled Asset Relief Program, or SIGTARP, in an investigation of bidding and price hikes for tearing down blighted homes in Detroit after costs rose from $8,500-$10,000 per home under former Mayor Dave Bing to an average at one point of $16,400 in 2014 under the Duggan administration's aggressive revamp of the city's demolition program.

Detroit has received more than $170 million from the TARP Hardest Hit Fund, dating back to 2013 and as recently as October 2015.

The Detroit demolition program already completed a review with the Michigan State Housing Development Authority over the rising costs of demolition, finding that costs rose an understandable amount when the Detroit Land Bank Authority and the Detroit Building Authority strengthened its contractor selection process. According to the article by Helms, Mayor Mike Duggan predicts that the federal government will reach the same conclusion. Helms details more about the city's business practices early in the demolition program and what's known so far about the emerging federal investigation.

For more detail of the investigation, see also an article by Joe Guillen and Tresa Baldas, who reported on the FBI joining the investigation earlier in May. Matt Helms and Joe Guillen were also reporting on the rising costs of the demolition program in October 2015.

Full Story:
Published on Friday, May 27, 2016 in Detroit Free Press
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