House demolitions through the Hardest Hit Fund’s Blight Elimination Program in Michigan could expose residents to hazardous materials and other risks, according to new report conducted by the U.S. Army Corps of Engineers on behalf of the Office of the Special Inspector General for the Troubled Asset Relief Program.

The report stressed the importance of fixing this by requiring specific industry best practices and strengthening state agency oversight.

“Treasury and state agencies are trusting and assuming that these demolitions and related activity are proceeding safely, appropriately, and in compliance with all applicable environmental and safety requirements and industry standards, but the U.S. Army Corps of Engineers found that this was not the case in Flint, Michigan,” said Special Inspector General Christy Goldsmith Romero.

After conducting field inspections of multiple properties in various stages of demolitions in July 2017 and reviewed documents of one completed demolition, the Corps most significant findings include:

• Asbestos removal appears to have been mismanaged by the Land Bank continuing through all contractors involved with asbestos.
• It’s unclear whether the material placed in the hole was clean and provided in accordance with the State and contract requirements.
• On properties with significant quantities of hazardous materials, partners and contractors may have allowed undue risks in order to keep total project costs under the $25,000 cap.
• All of the agreements and execution documentation were lacking in quality assurance.
• The state, city, and Land Bank performed redundant inspections of winter grade and final grade, and no other physical inspections were documented.

The Corps created the following list of recommendations to the U.S. Department of the Treasury, which manages the Blight Elimination Program:

• Inspections should be coordinated between agencies to limit redundancy.
• Require contractors to provide all submittals listed in the contract.
• Ensure Partners’ inspectors and contract administration staff are trained and qualified to perform the duties they are assigned (especially in the handling of hazardous materials).
• Require contractors to provide truck tickets for all fill material and topsoil deliveries in order to assure that the material is being purchased and delivered as expected.
• Perform risk-based quality assurance testing of fill materials at a limited number of sites.
• Create a process for allowing additional contingency funding ($5,000-$10,000) for properties with unusually high amounts of hazardous material removal.

“With demolitions ongoing, once we saw the Corp’s report we decided to alert Treasury promptly so it can take action to prevent as much harm as possible,” Romero stated. “With risk in all 248 cities and counties across eight Rust Belt and Southern states in the program, there is no time to waste:  state agencies should require local partners and contractors to follow industry-standard, common sense safeguards.”