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Detroit — Records detailing what went into the ground at thousands of demolition sites across the city are under scrutiny amid an analysis that's turned up a disjointed process.

University of Michigan doctoral candidate Michael Koscielniak has spent four years conducting an exhaustive review of public records that cast doubt on the integrity of soil records for the city's multi-million-dollar federally funded blight elimination program. 

For its part, the city admits the effort got off the ground with a paper-based tracking system before it evolved to online records. But officials contend the dirt used to fill holes left behind from housing demolitions is all accounted for and Koscielniak based his findings on only part of the data. 

But Koscielniak asserts the record keeping is a "completely shambolic approach to managing this program — especially one that is transparent."  The demolition effort has paid out close to $177 million in federal funding to take down 11,000 structures since 2014.

"The errors, gaps and inconsistencies in the backfill data — as well as the unclear oversight and monitoring processes — suggest that demolition contractors wield immense authority over the backfill program," said Koscielniak, an Ypsilanti resident and doctoral candidate in urban and regional planning who is working on a dissertation. "They stumbled into a mega project that they had no capacity to manage, and their solution to it was to let contractors figure it out."

The independent researcher's findings heighten growing concern among some city, state and congressional lawmakers over potential environmental contaminants in the dirt following a number of high-profile contractor violations. Officials want to ensure the quality of the dirt going into Detroit's ground isn't harmful to residents.

Under public information requests, Koscielniak obtained copies of an internal contractor portal used to track dirt sources, costs and locations that's maintained by the Detroit Building Authority.

He zeroed in on data for demolitions conducted through July and paid from the federal Hardest Hit Fund, concluding that out of nearly 10,000 listed only about 5,200 had attributed sources through digital record keeping.

Koscielniak's research is the latest cloud over the program at the center of a federal criminal investigation that arose in fall 2015 after concerns were raised over bidding practices and spiraling costs.

Soil worries prompted Detroit City Council's second in command to put out a call for a congressional hearing on demolition in Detroit and comes as one contractor's projects have been halted after it failed to remove potentially hazardous debris at multiple sites before dumping dirt on top. 

Officials with the Detroit Building Authority and Detroit Land Bank Authority, which oversee the city's program, argue Koscielniak's research is skewed and maintain their confidence in the records. 

Under Freedom of Information Act requests, they said, he obtained copies of the digital database for soil records. But prior to that, load tickets for dirt were tracked on paper — records Koscielniak did not ask for or obtain, they contend.

"We think the gap is, not that we weren't tracking it, but it wasn't tracked in an online portal that we could send to someone," Brian Farkas, director of special projects for the building authority, told The News. "I'm confident in our records."

Detroit Councilman Andre Spivey said he's concerned to hear of the disconnected record keeping for dirt and wants the city to have tighter reins on the land bank.

"You've got to maintain the integrity of the process," he said. "We're watching, and the federal government is watching as well."

In January, the federal watchdog agency investigating the city's blight elimination effort issued a round of subpoenas to certain contractors, seeking detailed records of where they obtained their dirt, the cost and where it ended up. 

In subpoenas dated Jan. 10, the Special Inspector General for the Troubled Asset Relief Program demanded two years' worth of documentation.

Robert Sholars, a spokesman for SIGTARP, declined to say whether Koscielniak's research spurred the investigation, saying "as a general principle, we do not comment on ongoing investigations, including confirming or denying their existence."

Tracking the records

The News last month provided the building authority with 13 addresses from 2014 out of thousands flagged by Koscielniak. Officials produced paper copies for all of them.

According to the load tickets, some of the fill dirt came from an industrial site on Shoemaker on Detroit's east side and a site in Carleton. Other paperwork identifies fill simply as "clay" or has spaces where the source is attributed to a trucking company or left blank, only listing where it was dropped off. 

Farkas last week referred to the 13 records pulled at the request of The News as a "spot check" while he faced questioning about contractors and environmental worries during a city council subcommittee session. 

Council President Pro Tem Mary Sheffield noted in recent months the tracking system for dirt is more in-depth. The building authority, she said, told council members the independent firm contracted to oversee the process is now verifying the origin of the dirt with aerial checks after documentation is submitted by contractors. Prior to that time, that verification was not taking place, she said.

"You had a period of time where contractors were self-reporting all of these different residential addresses and saying it was residential dirt when it could possibly have not been because there was no oversight," she said. "That's a problem."

Farkas said the city has tracked its soil and dirt on an internal online platform since March 2015. 

Despite that, Koscielniak provided The News with a data set that shows 1,961 Hardest Hit Fund demolitions between March 2015 and June 2018 that weren't accounted for in the backfill portal.

The sites in question, which appear on the city's public demolition database but lack a digital paper trail for the soil, account for $2.9 million in dirt costs among 18 contractors. 

Koscielniak also provided The News with more than 100 other records with misspellings and errors, lacking in detail or that list the dirt source and destination as the same site.

The News asked the building authority to reproduce documentation for a dozen of the 2015 demolitions, which based on Farkas' explanation should have been digitized. 

In an email, Farkas provided The News with eight of the records located by the department — all paper — out of the 12, citing limited staffing to search. But he stressed confidence the rest would be found.

"This is more a document retrieval issue of records that are four or five years old than it is an issue of whether dirt sources have been verified," Farkas said.

In reference to data suggesting close to 2,000 records submitted after 2015 aren't accounted for in the digital system, Farkas reiterated officials "feel very confident" in protocols in place since 2014 to ensure dirt is safe. 

"We see the fact that some records may not be immediately retrievable as a reflection in the record keeping process, not as a reflection of our work in the field to ensure the use of clean dirt," Farkas said in a provided statement. 

A handful of contractors have faced penalties between 2017 and 2018 for the use of unapproved backfill at a total of 18 sites, according to the building authority. 

Some were issued warnings, others were suspended and another — Detroit-based Glo Wrecking — was issued a stop-work order that remains in effect. The company could not be reached for comment. 

Additionally, in February, another contractor, DMC Consultants, began filling holes with unauthorized dirt. The building authority's online platform flagged officials that the company had exhausted their supply of approved fill. 

Farkas declined to specify DMC's dirt source, saying it "doesn't matter."

"All that matters is whether it's been tested and approved, and the DMC dirt used after their approved supply ran out was not," he said. 

Farkas said soil sampling is taking place for 37 holes that DMC filled with dirt that had not been approved. Testing will determine whether the soil is unsafe for residential use.

Chicago-based firm McDonagh Demolition was also issued a stop-work order by the building authority in recent weeks after it was discovered that the company had not fully removed demolition debris before adding fill dirt at several sites. 

Farkas, during the council's Planning and Economic Development committee session last week, said the company's work is being revoked over the "attempted scheme." It's going to cost McDonagh about $17 million in contracts, he said. 

McDonagh called the violation an "isolated issue" that it was taking steps to correct. 

Farkas touted the catch as evidence the building authority's controls worked, as intended, saying a field liaison for the building authority discovered the problem.

But Sheffield noted it was later revealed that a former McDonagh employee had acted as a whistle-blower.

The scenario, she said, is a "clear example" that "protocols are not sufficient."

"The pace that they are going, it is hard to have the proper protocols to ensure the health and safety of residents," Sheffield said. "There's too many unknowns for me. Whether it's contaminated or not, it just needs to be clear and verified where the dirt is coming from."

Under the program, the land bank manages the selection and contract awards for demolitions. Oversight is then transferred to the building authority, which has seven field liaisons who monitor all the knockdowns. That's up from two when the program first began, Farkas said. 

What the rules say

The city's Buildings,  Safety Engineering and Environmental Department inspects open holes and final grading.

The state's blight manual outlines requirements for testing and sourcing of fill. 

Detroit implemented a new dirt tracking system late last year to better document the dirt being used. The guidelines require the source of dirt, the address it's going to, and size of load by cubic yard or square feet, according to the state. 

Previously, contractors were required to provide invoices for dirt, and the land bank maintained load tickets that documented the size of a load and where it was dropped.  

"The new protocol requires each contractor to identify source material location and testing evaluation of commercial soil sources in advance of backfilling so as to avoid bad fill material negatively impacting neighborhoods," the U.S. Environmental Protection Agency said in a statement. "The city of Detroit is responsible for identifying dirt sources under its protocol."

Farkas said there are three acceptable soil sources. A residential site or a virgin source, which could be a clay or gravel pit and requires documentation stating its free of debris, concrete or other unsuitable substances. The third category, non-residential, may consist of commercial, road or construction sites but requires laboratory testing and the results must be approved by the building authority. 

"All city, state and federal guidelines must be followed to ensure environmentally safe back fill is being used," the blight manual notes. "This laboratory testing must be maintained in the blight partner office and copies may be requested at any time."

Matt Polizzotto, a soil chemist and associate professor of earth sciences for the University of Oregon, said urban soils can be contaminated in many ways, including from lead paint or past transportation emissions. The level of risk, he said, depends on how the soil had been used.

"I could come up with doomsday scenarios, but those things are pretty unlikely," said Polizzotto, who has expertise in soil contaminants in the environment. "Not having records doesn't allow for really, truly assessing what any risks might be."

'No legal obligation'

Rebecca Camargo, an attorney for several contractors in the program, said none set out to use bad dirt. 

"I don't believe that any of the demolition contractors violated the terms of the contract knowingly, and they all are very committed to keeping Detroit safe," she said. 

Camargo said the deadline for turning over backfill documents requested under the SIGTARP subpoena has been extended.

"It's costing all of them thousands of dollars to provide this documentation for something I believe is going to show nothing," she said. 

Multiple contractors did not return messages left by The News. Anthony Abela, a project manager for the firms Homrich and 1 Way Service, said by policy, the company does not issue comments to the media.

Mayor Mike Duggan has defended the program's "vigorous" practices in the wake of concern over whether some dirt might have been contaminated.

The mayor, during his Tuesday State of the City speech, noted the city this month entered into contracts for the last of the $275 million in federal dollars for the program.

"For all the noise out there about investigations," said Duggan, the U.S. Treasury and the state "had confidence in us" and "kept money flowing."

The mayor said the program's environmental team has held demolition contractors accountable. In the last five years, he said, four contractors have been terminated for failing to follow protocols.

"In each case, we made each go back in and fix their mistakes. We did not let a single one slide, and we advise the neighbors to help us," Duggan said. "I won't tell you that we're not ever making mistakes. I will tell you, we find out about them."

The mayor, during his Thursday budget presentation to council, said the all federally funded demolition contracts have been awarded and the program is set to wind down by the end of the fiscal year. From here, he said, the city will look to transition to a city-administered effort. 

Meanwhile, the state Department of Environmental Quality said it's "working with the federal agencies investigating the city's demolition program."

The DEQ has not issued any violations or fines related to backfill, and it has not done any soil sampling or auditing, said Scott Dean, a DEQ spokesman.

"An entity obtaining soil for backfill has no legal obligation to test those soils or keep records about the sources," Dean said.

"However, there is a risk that contractors may obtain contaminated soils, either knowingly or unknowingly. It seemed reasonable that this risk would increase with the increased demand for soils. Because of this risk, we advised the city to put safeguards in place to make sure they were only using clean dirt. That was a recommendation, not a legal requirement."

Pushing for testing

Council's Sheffield has referenced media reports that raise the possibility of dirt being used to fill holes that may have been contaminated or from unverified sources, including soils from the recent reconstruction of Interstate 96 in western Wayne County. Program officials insist, however, that use of dirt from the I-96 project was banned from the outset.

In a letter to U.S. Reps. Rashida Tlaib, D-Detroit, and Brenda Lawrence, D-Southfield, the councilwoman noted the program has been "mired in controversy since its inception" and it's led to "anxiety, uncertainty, and a lack of transparency for the community."

Lawrence told The News she's leading an effort to ask the delegation to urge the U.S. Treasury Department to assume oversight of soil testing for Detroit's program.

"My focus right now is on whether the dirt is contaminated," she said. "I'm pushing for immediate testing."

In 2014, the city contracted with the Southfield-based consulting firm Atwell to get the program's environmental monitoring off the ground. By September, AKT Peerless in Detroit was retained to "manage and administer" the backfill program.

Reached via email, Julie Barton, program manager for AKT, deferred comment to the building authority. Farkas said the company has designed testing protocols and the online platform, overseeing its use and implementation.

When asked whether the paper record keeping was adequate, Tammy Daniels, a demolition manager for the land bank, agreed it was a process that needed to change, and it did.

"We migrated away from paper because we, too, feel that computer records offer transparency," she said. 

Farkas noted when the federally funded demolition work first began, there was $50 million to draw down and a "serious deadline" that "we had to meet."

A 2013 memorandum of understanding between the state, land bank and city, required 70 percent of the $52.3 million allocated for the program be spent by Oct. 7, 2014. If the land bank was unable to draw down the funding within that time, the dollars could have been redirected to another city or program.

"The system we have today is remarkably different than the one we inherited," he said. "So no, records should always be kept in the most high-tech, digital format. The problem is we just don't have that ability when you are staring down a deadline to spend $50 million."

The Michigan State Housing and Development Authority, which allocates funding for the program under the state's Homeowner Assistance Non-Profit Housing Corp., said it does not oversee how the land bank maintains its filing system.

"What we do require is that file documents be uploaded to our system for audit and review prior to funding every demolition," said Katie Bach, a spokeswoman for MSHDA, in an email. 

Bach further said the state has found no evidence of sloppy record-keeping. MHA, she said, has adequate resources to monitor the backfill program and is confident in how it's operating. Under Hardest Hit Fund rules, MHA is required to retain records for three years after the program ends, she added. 

"MHA has staff in place to review every file that DLB is uploading to our system," she said. "We expect accurate documentation and full compliance with all program guidelines. If we find that is not the case, we will consult with U.S. Treasury regarding possible corrective action."

East side resident Felicia Perry has been renting a home on Rossini Drive for about a year. Records show numerous demolitions occurred on her block in 2014 when digital records of the soil source were lacking. The city's paper records attribute the source to a city-based industrial site. 

The mother of six, who has a young daughter battling chronic health concerns, said the questions and uncertainty are worrisome.

"I have a three-year-old who is battling every day to stay alive with sickle cell disease. I don't even let her outside," said Perry, 42. "If they put something in the ground that's contaminated, it's got growth in it. It brings poison to kids."

cferretti@detroitnews.com 

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