Block by Block shows the way: Not all flood-damaged homes on the City Hall buyout list need to be demolished

CEDAR RAPIDS - It's becoming clear that some of the 1,300 or so flood-damaged homes slated for a City Hall buyout can be renovated and returned to life. They don't need to be demolished.

Just how many can or should be saved is open to debate. But some can be saved.

Take the flood-hit, working-class home, now beautifully renovated - inside and out, top to bottom - which Andrew Smith has bought at 1312 J St. SW and now calls home.

“We basically got a brand new house,” says Smith, a 26-year-old, union apprentice heavy equipment operator. “It's a heck of a deal.”

A Jefferson High School graduate who had been commuting to work from Watkins in Benton County, Smith is now only five minutes from his job while he, housemate and girlfriend Cristi Gillis and two little children help to bring back an old, flood-hit Cedar Rapids neighborhood. Smith doesn't see any reason he won't be in the house 30 years from now.

Block by Block, the near-year-old, non-profit neighborhood revitalization engine, bought, renovated and sold the house to Smith - even if letting the house wait for a city buyout and likely demolition would have been an easier approach.

The non-profit - which has raised about $3 million in private dollars; has secured some $2.25 million in state funds; and has access to $1 million in revenue from the city's local-option sales tax - bought the house because it is sitting on one of the 24 flood-damaged blocks, with an average of 16 houses per block, that Block by Block is bringing back to life.

Most of the group's effort has gone into helping existing flood-hit homeowners renovate their homes, but in some instances, to move the program ahead, it's bought homes that can be fixed.

In truth, the group hasn't wanted to use its funds to buy the homes at 107 percent of pre-flood value, just as the city is doing. The program would prefer that the city buy out the houses, and, in turn, give the ones that can be fixed to programs like Block by Block.

But Block by Block has been moving too fast for the city's buyout effort, and the program has needed homes so its hundreds of volunteers have enough work to keep them busy. Block by Block has bought 21 homes to date to renovate, while the city has bought 85 so far, all close to the Cedar River and slated for demolition.

Block by Block is the creation of a trio of partners: Four Oaks family services agency and its Affordable Housing Network; Matthew 25 Ministry Hub; and the United Methodist Church.

Jim Ernst, president/CEO of Four Oaks and the Affordable Housing Network, says that Block by Block attempts to pay owners of flood-damaged homes what the city will pay them, although, in some instances, Block by Block may have fewer restrictions and may end up paying a little more.

Once the home is bought, Block by Block then has to renovate the flood-damaged homes, which can cost in most instances from $25,000 to $50,000 for materials and contract help, even with the assistance of some donated labor. The program spent $73,294 to renovate the home at 1312 J St. SW, which Andrew Smith bought.

Block by Block then puts the house back on the market in the price range where the house was before the June 2008 flood and in keeping with the property values of other houses on the block.

Andrew Smith, for instance, paid $74,000 for his renovated house at 1312 J St. SW, which had a value of $61,064 before the flood and cost Block by Block about $42,000 to buy after deductions for earlier insurance and federal disaster money the previous owner had received.

The money from the home sales then goes back into the pot for use on other home renovations in Block by Block blocks.

Selling the home at a market value consistent with the neighborhood is done to protect the property values of all the homes on the Block by Block blocks, explain Ernst and the Rev. Clint Twedt-Ball, co-director of Matthew 25. Arriving at a reasonable sale price also takes into account that the purchased and renovated homes have been transformed, top to bottom, making them “worth more now” than before the flood, Twedt-Ball says.

Block by Block's work now is helping to prompt City Hall to move ahead with a strategy on what to do with flood-damaged homes on the city buyout list that the city will buy, but may not need to demolish.

Just this week, Jennifer Pratt, the city's development coordinator, estimated that as many as 260 homes among 1,300 on the buyout list may be worth renovating. In the end, the city will demolish most of the flood-damaged homes on the buyout list, which will leave an estimated 469 “buildable” vacant lots, Pratt adds.

The emerging City Hall policy is one in which the city will consider giving away homes it purchases or lots it owns after demolitions to responsible programs and builders like the Block by Block program.

Council member Don Karr reports that one of the flood-damaged homes purchased by Block by Block is the home of his sister, Joyce Polton, at 1512 Eighth St. NW. Karr says his sister did not want to return to the flood area and selling was best for her.

“I think we've been tearing down homes that can be reused, and Block by Block is doing a good job of getting people back in some of those,” Karr says.

Ernst says Block by Block has identified 50 to 60 homes on its 24 blocks that are currently on the city buyout list. And he says Block by Block believes 35 to 40 of those homes can be renovated and resold.

Block by Block, he points out, likely will be one of several players in the neighborhood-rebuilding process, but Ernst says Block by Block d will assure that homes it renovates on its blocks become owner-occupied ones and not rentals, and it will assure, too, the same with lots it controls on its blocks and on which new homes are built.

Mayor Ron Corbett says several other factors need to be weighed along the way:

The houses on the buyout list that might be candidates for renovation have been sitting empty for two years. Renovations need to occur in quick order if they are to happen, he says.

Some who put their houses on the city buyout list many months ago did not realize at the time that local-option sales tax revenue is now available to help with renovation costs over and above state help. Maybe some of those people now would want to renovate and return rather than take a buyout, he says.

In some instances, Corbett says the city might be farther ahead to demolish a home and take money it would have used for renovation to subsidize the mortgage on a newly built home, he says.