'Worst of worst' converted to homes

July 15, 2014

West Allis — West Allis will soon demolish a seventh dilapidated home and build a three-bedroom home in its place in the city's continuing battle to stem neighborhood blight.

The new home will be sold to a family meeting federal income guidelines for $100,000 to $120,000.

"We bought the worst of the worst because nobody in the private sector is going to do that," said city planner Kristi Johnson. The goal of using federal dollars to buy, raze and build new homes is to stop the spread of blight and stabilize neighborhoods, she said.

The city has cleared six aging homes that way since 2009 and is now looking at clearing six more.

Of the original six, three were foreclosures from Milwaukee County that offered them to the city below market value, Johnson said. The new homes were sold to families meeting income guidelines for the federal Neighborhood Stabilization federal dollars.

Last week, the Community Development Authority decided to go ahead with building a new home at 2159 S. 61st St. for a total of $225,100. With the $34,000 acquisition cost, the total tab using federal dollars is $259,100.

The sale price of $100,000 to $120,000 is low compared to the actual costs because the house must be affordable to families at 80 percent or less of the Milwaukee County median income, Johnson said. For a family of four, that would be $56,250 this year, she said.

Feeling that $225,100 is high for razing the current home and building a new one, Alderman Dan Roadt suggested razing the home and giving the land to a qualifying family which then would build a home.

"We can try it," said John Stibal, development director, noting that nearly $150,000 is a deep subsidy. But because a federal deadline is pressing, the CDA approved the combination demolition and building contract for the 61st Street home.

But Roadt's suggestion might be explored for the two other homes the city owns and plans to raze and for the three additional homes it may buy, under the federal program, Johnson said after the meeting.

But without a subsidy, families qualifying under the income guidelines might find it hard to build, even with a free lot, Johnson suggested.

"Given the limited financial resources available, I'm not sure who would be able to build a house," she said. But if they think they can, the city would consider it, she said.

Voting against the demolition and building contract was commission member Wayne Clark who objected that only one bid came in for the job.

"Are we being good stewards when we only have one bid?" he asked.

City officials also were surprised at the lack of response. They sent 27 requests for proposals to businesses in the Wisconsin Builders Association and received only one bid, Johnson said.

"I can't believe we only got one bid," Stibal said.

Although that bid is within expectations, he said, next time they will split the job into separate demolition and building contracts. Some companies specialize in just one or the other and didn't want to get involved in the unfamiliar area, Johnson said.

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