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Detroit — A demolition contractor suspended by the city of Detroit has been cleared to return to the program after testing of unverified soil used at several dozen sites revealed the dirt didn't pose a safety risk, officials said Wednesday.

Work by DMC Consultants had been halted since February after the firm came under fire for filling holes throughout the city without gaining the proper approvals for the dirt as required under the program. The company was notified in a Tuesday letter from the city's Building Authority that the stop-work order had been lifted. 

"At the end of the day, the soil was acceptable for use in residential sites," said Brian Farkas, director of special projects for the Building Authority, which jointly oversees the city's federally funded demolition work with the Detroit Land Bank Authority. 

The soil sampling initially was expected to take place at 37 sites that DMC had filled. Farkas said officials ultimately flagged "70 sites of concern for unapproved fill dirt" but stressed there was "no indication of contamination."

DMC paid for the testing by an independent environmental professional. The results were then reviewed by an environmental firm hired by the building authority.. 

The results complied with Michigan Department of Environmental Quality standards, Farkas said. 

Officials with DMC could not be immediately reached Wednesday for comment. 

DMC is now able to resume work on $4.3 million in contracts to tear down 228 houses.

The company, however, remains suspended from bidding on new projects through April 30 in connection with a January citation it received for failing to upload proper data. 

DMC is among several contractors in recent months to face penalties under the city's demolition program after concerns were raised over record-keeping for potentially contaminated dirt and other backfilling practices at project sites.

The use of dirt in the program is also being looked at by a federal watchdog agency conducting a criminal investigation of Detroit's federally funded blight elimination effort.

In January subpoenas, the special inspector general for the Troubled Asset Relief Program sought two years' worth of documentation from certain contractors over dirt used to fill holes for homes torn down with federal dollars. 

Federal investigators demanded that demolition firms produce receipts and records that reveal where their backfill dirt was coming from, who trucked it to sites in Detroit and where it was dropped off.

Farkas said DMC initially had a stockpile of 100,000 cubic yards of pre-approved dirt. As the company drew that down, an internal portal used to track soil used by demolition contractors flagged that the firm was using more dirt than than the approved amount.

The soil sampling review involved sites filled by DMC after the 100,000 cubic yards was exhausted.

Also this week, an environmental firm hired by the land bank has begun using ground-penetrating radar to test random work sites for three demolition companies as part of an auditing pilot

Detroit-based Gayanga Co., Blue Star out of Warren and Chicago-headquartered McDonagh Demolition are being targeted under the audit amid claims that they failed to fully excavate debris at multiple demolition sites. 

Farkas said so far two sites have been scanned with the radar equipment. Officials are waiting for the reports to come back and expect the results later this week.

Gayanga and Blue Star were issued stop-work orders in late March on allegations they failed to clear out basements and other debris at some sites. Both were reinstated last week, officials said. 

Gayanga has said all of the sites in question received open-hole approval from the city's building department before it self-reported small pieces of concrete left at the sites to a building authority field liaison. The liaison, they said, subsequently observed the removal of the concrete and a supervisor verified no additional concrete was found at the sites.

According to the building authority, Gayanga's last federally funded demolition was conducted in May 2018, within the past 12 months that the audit intends to review. 

The firm's attorney, Rebecca Camargo, has noted that Gayanga completed 32 of its 34 federally funded demolitions in 2017. 

McDonagh, meanwhile, was officially ejected from the program last month after program officials determined the company was not working fast enough on remediation plans after it left debris in holes and added fill dirt on top. 

Under a settlement reached last week, McDonagh will complete its outstanding demolition work and remediate other sites at its own expense. 

But McDonagh will not be allowed to proceed on about $17 million in demolition projects that it has not yet started. It's also prohibited from obtaining any additional federally funded demolition projects. 

McDonagh, in a statement, has said that an internal investigation "uncovered evidence that individuals acted on their own, without the knowledge, authorization or consent of McDonagh ownership or management."

The company added that it's been "committed to providing Detroit with safe and responsible services."

The building authority and land bank said the new auditing protocol was developed in partnership with the state Department of Environmental Quality.

The exact amount of sites audited for each of the three contractors will be based on a calculation tied to the amount each has backfilled within the last year.

Some local, state and congressional leaders have urged hearings over the demolition program in response to concerns that some soil used at sites throughout Detroit may have come from unverified or contaminated sources, including the recent reconstruction of Interstate 96 in western Wayne County. 

The building authority has said that in August 2014 it banned use of any dirt from the I-96 project to fill residential demolition sites after independent soil testing was conducted.

The Michigan State Housing Development Authority, which allocates federal funding for the program under the Homeowner Assistance Non-Profit Housing Corp., has said that the city implemented a new dirt tracking system late last year. 

During the time referenced in the January subpoenas, the city required contractors to provide invoices for dirt and the land bank maintained load tickets that documented the quantity of soil and where it was dropped. Now, the state has said, the source is being documented as well.

Katie Bach, a spokeswoman for MSHDA, said Wednesday that the state received a copy of DMC's soil findings, which met program guidelines, and it expects to be informed of the auditing results as well.

"MHA will continue to monitor the demolition program to ensure all guidelines, rules and regulations that have been put in place to protect the health and safety of Detroit residents are being followed," she said. 

cferretti@detroitnews.com 

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