...and Dealing With Hud

SUN: The city has recently made made some bold mores against the problem of abandoned houses owned by the federal government 's Department of Housing and Urban Development (HUD). Why is it su important to do this that the city would risk legal action by the federal government in order to tear down these houses?

COLEMAN: I think the reason is the past history of the local HDD administration - an attitude of complete disregard, if not arrogance, toward the city's responsibility for protecting the health and safety of its citizens. Now as Mayor, I, along with the City Council, have the responsibility of protecting the health and safety of our citizens. We look upon HUD, to the degree that it threatens this, as we would upon any other landlord.

There's no question that HUD is the biggest landlord in the city of Detroit. In fact, when you consider the fact that one-third of the total repossessed federal housing stock in the nation exists in the immediate Detroit area, then you begin to question whether or not Detroit, rather than Washington, is the federal city. HUD owns thousands, if you include multiple units, of abandoned or repossessed structures, many of them hazardous. For a period of well over a year, we have condemned some of these properties for demolition. HUD had been summoned to the hearings; in other words, they've been given due process in order to present their case, but they've ignored the notices completely. So we've determined that if they're not gonna move, we're gonna move. We’re not going to allow HUD, or any other landowner, to maintain property which we consider unsafe.

SUN: Beyond the houses the city wants to tear down, what's your approach to the other, HUD properties in the city, and to its run-down housing stock in general? For example, is the city interested in taking over federal projects and managing them?

COLEMAN: Yes, definitely. But here you have a basic policy conflict between us and HUD. HUD's policy is to cling on, in the face of all empirical evidence, to a policy that's been a failure, and as far as Detroit's concerned, a disaster. They still insist that they must recover their initial investment.

Now, the only persons who profit from this type of policy are the mortgage bankers. When they go in with FHA-guaranteed mortgages, they could care less whether or not a property that's worth six thousand is mortgaged at fifteen. See, because when the mortgage defaults, they get their money. What HUD does, blindly looking at a $6,000 property, they look at the $15,000 they had to pay off and they attach that on to the price. Then the processing and the interest rate adds it up, and it's $18,000. So now they're trying to get $18,000 for a S6.000 house.

So, you know, some person who cannot afford the house comes in, at a minimum down payment, takes on notes they can not possibly pay, and in many cases takes on essentially unsound property which requires just massive capital investment - which they don’t have.

After struggling for a few months, they discover, first of all, that they have no equity. It'd be a hell of a lot cheaper, as far as they're concerned, to walk away, than to stay there and fight. So another increment is added on.

Although there is some evidence that, in some specific cases, HUD is beginning to recognize the impossibility of its policy approach, it has yet to recognize that the housing program has been a fiasco and walk away from it - take the loss and walk away from it. I don't care what your property's worth. If you can't sell it, if the damn thing's deteriorating, if people are forced to leave it, or the vandals move in and strip it, it's not even worth six - it becomes a zero-value home. And over and above that, a hazard and an accelerator to the deterioration of a community.

So we're saying that to the degree these houses can be rehabilitated, turn them over to the city of Detroit for a dollar each, or free. We will, in turn, take them in blocks of fifty and turn them over to responsible contractors, who will rehabilitate them. Then we will sell them - not at the exaggerated figure of $18 or $20,000, but for whatever it's worth to rehabilitate them, plus a little money to maintain a revolving fund, but not to make a profit. Conceivably, you could come up with homes worth in the area of $15-$16,000, and sell them not for $26,000, but for $12,000.

We believe that's a general approach. So we ask initially for 2,000 homes, and we're promised 2,000.

SUN: Are you pitching them on any particular kinds of neighborhoods where you want to concentrate this kind of development?

COLEMAN: Oh, yeah. We obviously do not want to use the shotgun approach. We want to turn whole neighborhoods. Initially, we thought to rescue the East side, which is probably going down faster than anything else.

SUN: It isn't down yet.

COLEMAN: Oh, no. In fact, one of the things we're doing right now, which I consider very positive, is the area in which I spent all my life, ol' Black Bottom, the Lower East Side - it's now known as Elmwood III. It's 188 acres, probably the largest package of urban renewal-cleared land anywhere in a federal city in America. It's being rebuilt. We’ve already built the first phase of Franklin Wright homes there, and they're for moderate and low income people. There are ten applicants for every person we were able to accommodate there, which blows the HUD myth that there's no market for this type of housing here. And we're now proceeding to build that whole area. We hope to have it completed within the next two years. This would be literally a new town in town. It’ll be the size of a small city when we get through.

We're also building on the west side, in the area immediately west of Livernois and centered north and south of Six Mile Road.

What we want to do is control development, certainly to guarantee that speculators don't move in, and to guarantee that the needs of the community are met - like shopping centers, or whatever the best use of the land might be, in terms of an overall plan rather than a helter-skelter promotion. So we are attempting to do a lot of land banking. That's what we'll do with these houses as we demolish them. Where you can assemble plots within a given block, obviously you're more flexible.

SUN: Would you want future rebuilding and rehabilitation projects to have the character of an Elmwood II, for instance, or to try harder to preserve the existing character of the neighborhood?

COLEMAN: Well, there is no question in my mind that the whole HUD policy, at another level, that was responsible for the emergence of Elmwood II would be suicidal if we extended it across the city. The price that we paid for Elmwood II could hardly be calculated. It was a disruption of a long-established and viable community. I know, because part of Elmwood II existed in an area where my father had a small business for twenty years when I was a kid. I can very personally testify to the fact that this was a cohesive and stable community, where there was social interaction which provided for a certain stability, lack of crime, etc., that can only be acquired over a period of time.

I look on the city, really, as a coalition or assemblage of small towns. Every community takes on a certain character and a certain stability. So to the degree that you screw up these small communities with expressways and bulldozers and whatnot, you actually shred the social fabric of a city, and you create the conditions for crime, dope, and every other thing that plagues us now.

So I feel very strongly about the inadvisability, in fact the inexcusability, of just bulldozing whole communities. And outside of the social implications, economically it is a disaster. When you roll through, as they did, streets like St. Aubin, Russell, Chene - which I can remember very well for the businesses and the community centers that they had - you throw thousands of people out of work.

Plus, there's a tendency to destroy recklessly, with no prospect of what you're gonna put in its place. I'm against tearing down any damn thing unless it's a health or safety hazard, unless you have a plan to put something in its place. That's what they did. Now here again, I speak from experience, because the space on which my father's tailor-cleaner shop was located was vacant for almost fifteen or twenty years. There's no excuse for that, that disruption of a community.

First of all, I believe that any large-scale project, such as Elmwood II, should reflect the social-economic relationships of the city as a whole. I think there was an attempt, a political attempt, on the part of some to re-establish a white, middle-class, relatively conservative element in the heart of the city to counteract the predominantly black and more militant communities that had begun to become cohesive. In cohesiveness, they had unity, and they were beyond the control of any of the elements in the power structure - and that stuff is dangerous. They just bulldozed it.

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In our next edition, Coleman discusses a wide range of issues crucial to the future of the city, including mass transit, the national urban crisis and the federal government, the 1976 Presidential election, and the question of continuity of leadership for the city of Detroit.