Thursday, May 24, 2018
News Roundup

Belmont Heights developer says it offered help to families hit by toxic drywall

TAMPA — Fed up with being blamed for the Chinese drywall found in 12 government subsidized homes in Belmont Heights, New Jersey firm Michaels Development Co. is going on the offensive.

As developer of Belmont Heights Estates, Michaels has faced criticism for refusing to help families who were stuck living in the homes for up to nine years. It did not build the homes with tainted drywall but did hire the now-bankrupt subcontractor that did.

Now, the company has written to the Tampa Housing Authority and Florida leaders including U.S. Sens. Marco Rubio and Bill Nelson, and U.S. Rep. Kathy Castor, D-Tampa, complaining that its reputation is being unfairly damaged. The move is in response to a plan floated by the Tampa City Council to ask federal lawmakers to lobby the U.S. Department of Housing and Urban Development to bar Michaels from competing for federal contracts.

"We have every sympathy for the situation in which these homeowners find themselves," wrote Gary Buechler. president of parent company The Michaels Organization. "We, however, do not deserve the tarnish that our reputation is taking over this situation...."

In the letter sent Dec. 27, Buechler highlighted the assistance his firm has given the families and the neighborhood.

It provided information about class action lawsuits against the manufacturer of the drywall and estimates it spent at least $120,000 boarding up vacant homes and maintaining the landscaping after some families abandoned the homes.

Milton Pratt, senior vice president of Michaels, is scheduled to meet with the four families on Monday to help finalize their relocation into temporary accommodation in Belmont Height Estates while their homes are rehabbed. Michaels, which leases and manages the housing complex, said the "good faith" gesture will cost the company at least $18,000.

Still, earlier this year Michaels was initially reluctant to make that gesture, said Leroy Moore, chief operating officer of the Housing Authority. In 2011, the Housing Authority wrote to Michaels asking the firm to do more to help the families.

The Housing Authority late last year reached out to HUD and asked it to pressure the firm to provide more help.

"Michaels had not come to the table the way we wanted them to," Moore said. "They are clearly at the table now, so you can read into that what you will."

The 12 families, most living in public housing, unknowingly bought the blighted homes in 2008 through a Housing Authority home ownership program that included down payment assistance from the City of Tampa.

Fumes from the drywall corroded copper and electrical wiring, damaging air-conditioning units and appliances. Residents complained of nosebleeds, headaches and breathing difficulties.

Eight of the 12 families walked away from their homes, which went into foreclosure. The remaining families are still making hefty mortgage payments on virtually worthless dwellings.

After a Tampa Bay Times article highlighted the residents' plight, Hillsborough County commissioners approved spending $205,000, mostly from affordable housing funds, to pay for renovation of the homes and short-term hotel accommodation for the four families.

The plan requires the city to roughly match that amount through a federal grant intended for low-income families to make home repairs. Tampa officials are seeking a contractor to rehab the homes, which could take up to nine months.

The City Council is waiting on a response from a letter it sent to Michaels on Dec. 16 before deciding whether to move ahead with its plan to push for Michaels to be barred from winning future HUD contracts.

"Having the government bail you out when, in this City Council's view, it is your company's responsibility, if not financially, at least morally... will not endear you to the decision makers in the future," the letter states.

Contact Christopher O'Donnell at [email protected] or (813) 226-3446. Follow @codonnell_Times.

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