A demolition site on the city’s east side is slated for a $52,000 overhaul to replace contaminated soil as part of a wide-ranging analysis of so-called “dirty dirt” used at hundreds of sites across Detroit.
The Detroit City Council on Tuesday approved a contract with Detroit-based DMC Consultants to remediate the lot at 5562 Pennsylvania. This represents a fraction of the millions of dollars under consideration by the city’s legislative body for a broader analysis and backfill remediation stemming from work performed by the demolition firm Gayanga Co.
City officials have accused the Detroit-based demolition contractor of using contaminated dirt to backfill properties. The company and its owner, Brian McKinney, are the focus of a federal investigation. McKinney announced earlier this month that Gayanga was folding and filing a defamation lawsuit against the city.
The steep cost of replacing the soil at the single site raised alarm and frustration among council members during Tuesday’s formal session and a recent Public Health and Safety subcommittee meeting.
“For $50,000, is that what we are going to be spending on each one of these sites that we find that the testing comes back that it is contaminated? Because, at that point, that is a lot of money that we also have already paid to demolish and fill on these sites. And now we’re doing it again at $50,000 a pop. That adds even more concerns,” Denzell McCampbell told Raquel Harrington, a representative for the city’s Construction & Demolition Department, during a committee meeting on May 11.
Harrington responded, “Yes, that is the total,” and said the cost factors in multiple rounds of testing, excavation, landfill approvals, refilling the site and other costs.
Gabriela Santiago-Romero called it “a little maddening,” noting that many demolitions are $15,000 to $20,000 apiece and “now we’re filling in holes at $50,000.”
Eric Cooper, a manager from the city’s procurement office, said that the Pennsylvania property is one of the more costly sites he’ seen and that others likely won’t rise to that level.
“This was one of the pricier ones,” he told the Public Health and Safety committee. “I don’t think you will see a lot of these, but the price is going to vary based upon the size of the actual hole that has to be dug out and the amount of material that has to be put back in.”
During Tuesday’s formal session, Tim Palazzolo, head of the Detroit Demolition & Construction Department, confirmed that the removal and replacement contracted for the east side site is the result of ongoing sampling and analysis by The Mannik & Smith Group, Inc.
The council is currently weighing a $3.5 million increase to a contract the city has with the consulting group to continue its environmental due diligence work.
Council on Tuesday delayed action for a second week on the Mannik and Smith contract and several others related to demolition remediation at the urging of several members. President James Tate has advocated for a closed-session discussion on the contracts, costs and potential actions that could be pursued against Gayanga to recoup some of the money being spent to correct the backfill issues. A closed session is expected to be held in two weeks.
Detroit’s Office of the Inspector General suspended Gayanga and McKinney last September from doing work in the city after investigators said they found the company was using contaminated dirt to backfill residential demolition properties. The OIG alleged that the company had sourced contaminated dirt from the redevelopment of the former Northland Mall site in Southfield. Gayanga had been awarded tens of millions in city demolition contracts since 2018. Gayanga’s suspension was lifted on March 11 since the city’s debarment ordinance limits suspensions to 180 days.
The city is conducting soil testing and analysis at approximately 650 sites identified through various investigations. Originally, a $1 million contract with Mannik and Smith was authorized for general environmental consulting services. The $3.5 million amendment is to cover costs associated with the backfill testing, according to the city.
Palazzolo said in a statement earlier this month that the city will use a “methodical approach” and “directly inform households near each site of our work.” On Tuesday, he told council members that the city wants to investigate the sites as quickly as possible and that Mannik and Smith’s pricing is competitive and its work has remained consistent.
A Detroit Free Press investigation earlier this year found some residents living near the sites, which in some cases are clustered within a few city blocks, were unaware of the possible exposure risks.
McCampbell has previously said that he won’t support the $3.5 million contract increase, arguing “Detroiters should not be on the hook for malfeasance.” On Tuesday, he said he had reservations about the contract, but understands the need for the testing.
Most council members agreed that, absent a closed session, they don’t have the full picture of what’s going on. Tate didn’t disagree that there’s an urgency to continue the work.
“It makes sense, but I want to understand the totality of what we’re looking at,” he said.
Council Member Angela Whitfield-Calloway shared similar concerns. The contract is supposed to run through 2027, she said, adding: “I’d like to know more about where that $3.5 million is gonna go.”
Santiago-Romero was absent for Tuesday’s session but has expressed her frustration that the cost of the review and remediation is falling on the city and she’s pressed the Detroit Law Department to seek reimbursement.
“At the end of the day, we’re still need to fix this for Detroiters,'” she told Detroit attorney Graham Anderson during another recent subcommittee session.
Anderson said that the council’s concerns are “for good reason.” The law department, he said during the subcommittee meeting, won’t seek cost recovery for the Mannik and Smith contract, but he did signal that Detroit would pursue a cost recovery action for total damages.
“We absolutely hear you when it comes to cost recovery,” he said. “That action is being pursued. Gayanga has a long list of creditors and we’re one of many. We’ll do everything we can in our power to collect what we can.”
Santiago-Romero said the city gave Gayanga a lot of contracts and officials trusted the procurement process.
“We asked the questions … and this is still where we are,” she said. “This is why people don’t trust the government.”
Former Detroit mayor and current Michigan gubernatorial candidate Mike Duggan convened a press conference in late December, just before his mayoral term ended, announcing Detroit police and state environmental officials were probing companies believed to have filled demolition sites with toxic fill dirt. Duggan, at the time, acknowledged that hundreds of sites could be contaminated and that cleanup costs could run into the millions.
The federal investigation involving Gayanga is the latest into Detroit’s demolition practices in recent history.
Detroit’s federal demolition work got underway in the spring of 2014, but the following year it fell under scrutiny amid a spike in costs and concerns over bidding practices. Those issues and others prompted multiple federal, state and city reviews and investigations.
Two men involved in the federal program were charged and ultimately pleaded guilty to accepting hundreds of thousands of dollars in bribes and rigging bids to tear down homes in the city.
Overall, the city razed more than 15,000 blighted homes under the federal effort jointly run by the land bank and Detroit Building Authority. Oversight of demolition work has since shifted in-house under Detroit’s Demolition Department.
“I understand that we can’t go back and there’s yet another federal investigation,” McCampbell told the council committee this month. “The rush and the amount of demolition that occurred leads to something like this, in my view, happening and us now having to go back.”
Santiago-Romero has called the Mannik & Smith contract “a hard pill to swallow” and said, “This does not feel good in one’s body.”
