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The Cost of Vacant Houses, Collapses and Demolition

December 9, 2011

The Baltimore Sun‘s Jamie Smith Hopkins, citing this GAO report (pdf download), says Baltimore would need to spend about $180 million to demolish all its dangerous vacant buildings and clear the lots:

Officials in Baltimore, Detroit, and Chicago, in particular, stated that the resources required to demolish the large number of long-term vacant properties in those cities exceeds local budgets,” the GAO wrote, adding: “Baltimore officials estimated that the city would need approximately $180 million to demolish the inventory of unsafe, unattended properties in the city.”

By Hopkins’ count, about 16,000 buildings need to come down.

That means each demolition would cost an average of $11,250. That is an interesting figure; In 2006 Jerome Dorich, the city’s demolition master, estimated that taking down the 2,000 or so buildings then on the city’s demolition list would cost about $15 million—or $7,500 per building.

Dorich’s estimate appears to have been low—and so is the $180 million figure. In the GAO report itself, city officials estimate each building would cost between $13,000 and $40,000 to take down.

Between 2006 and 2009, the city spent an average of more than $24,000 for each of the 89 “emergency” demolitions undertaken. That price included a $2,500-per-job surcharge, so figure $21,500 for a typical non-emergency take-down of a whole house. Since 2005, the emergency jobs have been handled by P&J Contracting.

P&J has gotten a lot of city demo work in the past few years. Mark Reutter of the Baltimore Brew has started looking into the company’s performance, finding sloppy work and fortuitous relationships among and between founder Pless Jones’ family members and their companies.

Jones and P&J contributed $8,000 to the mayor’s election campaign, the maximum allowed, the Brew noted in September. Brew:

P&J has been the recipient of more than $25 million in city contracts, mostly for demolition. These include $12.1 million for tearing down 500 rowhouses for the East Baltimore Development, Inc., $6 million to demolish scattered housing for the city Department of Housing and Community Development, and $2.6 million for the implosion of Lexington Terrace, a high-rise public housing complex.

If the city owns 22 percent of the 16,000 vacants, and they all need to come down, then it’s been piling them up over the past decade. Twenty-two percent of 16,000 would be 3,520 buildings. That’s about twice as many as Housing Commissioner Paul Graziano claimed were on the city’s condemnation list in the summer of 2006, when he criticized City Paper’s reporting about the number of building collapses the city was enduring:

The reporter also neglected to mention several city efforts under way to better identify and track problem properties before they become a threat. For example, the city recently reviewed every one of the more than 4,500 properties on the condemnation list and determined that only 1,700 still qualify for condemnation. Each of those 1,700 properties is now reinspected every 10 or 30 days, depending on its level of risk. Efforts like this will help us better protect residents and properties.

Of course, the GAO’s cost figure is but one data point, and should not be read as gospel–even if it did originate with Baltimore Housing. The GAO report says the 16,000 are not necessarily demolition candidates,  just “unattended and blighted”:

Because developing precise counts of the number of vacant properties that are creating problems for communities using national data sources is difficult, various local governments and nongovernmental organizations have undertaken their own tabulations of the number of unattended or abandoned vacant properties in their areas. However, differences in data collection methodologies mean that they cannot be directly compared to national data. Baltimore’s code enforcement department tracks vacant properties through its code violation system, and officials stated that city housing inspectors have identified 16,000 long-term vacant properties— many or most of which were vacant prior to the foreclosure crisis that began between 2005 and 2006—that the city considers unattended and blighted. Chicago’s Department of Buildings has a vacant buildings listing of 18,000 properties.

Still, the report says that the number of vacant properties in Baltimore increased by 11.4 percent between 2000 and 2010. This despite multiple city programs—SCOPE, Project 5000, and now “Vacants to Value”– designed to convey empty buildings to developers.

And if the cost of demolition is eye-popping, consider the cost of not demolishing them.  This paper cited in the GAO report (.zip file downloads without .zip suffix. Fun!) calculated $1,472-per-vacant in fire and police costs annually. This excludes the $200-per pop boarding-up cost and, of course, human costs like this.

At $1,500 in additional public safety and boarding costs, and assuming they don’t collapse on someone’s head, the city’s long-term vacants are costing taxpayers about $24 million a year.

At a perhaps more realistic (or at least more typical, these days) $20,000-per-building removal fee, getting rid of those 16,000 would cost $320 million.

Update: city Housing Spokeswoman Cheron Porter says the correct figure is actually $180 million–but she would not provide an updated estimate of the actual number of Baltimore buildings requiring demolition, writing, in response to an emailed question, “I think we have answered the question about how the $18[0] million was arrived.” Given that about 30-35 houses used to fall down each year in the early-mid 2000s, and given that the city pledged in 2006 to reduce that problem, I asked how many Baltimore buildings have collapsed so far in 2011. Her answer:

“In this year of earthquakes and Huricanes Baltimore has had 29 partial collapses requiring emergency demolition responses for 2011 to date.”

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