City Of New Orleans overcharged homeowners for blight demolition - FOX 8 WVUE New Orleans News, Weather, Sports

City Of New Orleans overcharged homeowners for blight demolitions

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NEW ORLEANS - When Mayor Mitch Landrieu took office he launched an aggressive campaign against blight. So far, over 1,000 properties have been demolished in the City of New Orleans. But what the administration didn't realize at the onset of this campaign, is that hundreds of residents would be overcharged by thousands of dollars, all because of a mistake made by someone in the Nagin administration.

Kimberly James is still getting used to living in Baton Rouge. James' Ninth Ward home was nearly destroyed by Hurricane Katrina.

The mother of three first lived in a shelter after Hurricane Katrina so that her daughter could finish high school in New Orleans. Eventually she and her family made it to Baton Rouge, all the while, working on their Ninth Ward house, with the goal of one day moving back home. James poured thousands of dollars into the house, replacing the doors, windows and plumbing. But in July, she was hit with the shock of a lifetime.

"It was my gardener who let me know the house was demolished," she said.

The city deemed her property blighted and tore the house down. In a joint investigation with our partners at The Lens, FOX 8 first told you about Kimberly James in August. The DRC group was the contractor the city used for the work. To her surprise, James received a bill after the demo for $12,000.

"I couldn't afford to pay it," she said. "I was like, wow."

To tear down the 1,700-square-foot building, the city charged $4,200. To refill the lot with sand after the home was torn down, the city charged over $7,000. After seeing how much they were charged for the sand the James family had questions about the cost. So we wanted to see how the city contractor's fees compared to what local sand and gravel suppliers charged.

Sean Villavaso runs Murphy Sand Company in Chalmette. Villavaso has years of experience in the construction field and was shocked to see how much James was charged for the sand to re-fill her lot.

"That's got me puzzled. That's a little strong," Villavaso said. He explains that the sand is needed to level a lot off after a demolition takes place.

Villavaso says he normally charges about $2,000 for a lot similar to James'. Another company we checked with, New Orleans-based Pontchartrain Materials, tells FOX 8 they would've only charged about $2,300.

After pulling the city records for other blighted property demolitions, FOX 8 discovered Kimberly James wasn't the only homeowner paying heavily for sand. At 4121 Willow Street Uptown, a home was torn down in February of last year. The records show the property owner was charged $5,800 for sand to refill the 4,500-square-foot lot. Based on the specs provided, both Villavaso and Pontchartrain Materials say they would have charged around $1,900 for the sand.

In New Orleans East a homeowner on Burke Avenue was charged almost $10,000 for sand after the property was demolished in May. Both Pontchartrain and Murphy estimated it should have cost about $3,000.

While researching this story, FOX 8 learned from a Landrieu administration spokesperson that City Hall was aware people were being overcharged.

The DRC contract was awarded in 2010. In a statement city spokesman Tyler Gamble, wouldn't say exactly when the problem was detected. He tells FOX 8 that sometime over the course of the past three years, the city's Department of Code Enforcement realized that the specs outlined in the proposal were not cost effective. Gamble says the quantity of sand the bid estimated to complete the demolition process, turned out to be too low.

"They underestimated the quantities, so if you add more quantities to the lot, it's going to make the whole figure go up," Villavaso said.

Kimberly James wants to know why no one in the Landrieu administration took action to fix the high cost of sand. Gamble says under public bid law, when a contract is awarded the city cannot negotiate each line item on the bid.

"To me, they just expect us to accept that they're doing this to us and I'm just not one to do that," James said. "I just think they should've come forward before, I mean, even though we had to bring it to their attention, someone should've been working in the office to see that these numbers were just outrageous."

Now, facing a $12,000 bill, which the city admits is higher than it should be, James is filing suit.

"Very angry and I don't know what to do," she said. "That's why I'm trying to let the lawyer do it and I don't want them to take our land. They already knocked the house down - don't take our land from us."

The city's contract with the DRC group ended in September. There's now an invitation to bid on the new contract, so that the city can continue performing demolitions of blighted properties.

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