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Things Fall Apart

Building the ghetto of the future in Central.


From a distance, the Villages of Central looks like a postcard for the American dream. Rows of two-story houses in soothing grays and blues line East 46th Street like a scene out of Edward Scissorhands, with cozy porches, flowers, and trimmed front yards. It's a tidy, working-class oasis in the poorest neighborhood in the city, complete with kids pedaling bikes on the sidewalks.

Take a closer look, however, and the rosy vision quickly falls apart.

At Aneesah Fleming's four-year-old home, the front steps are sinking away from her porch. Her driveway has shifted to a stark slant, driving rainwater toward the basement. Many of her electrical outlets don't work. In the backyard where her six children play, planks and bricks from previous demolitions emerge through the soil when it rains.

One street over, Anthony Moore washes his car in the driveway next to his garage -- which was built on someone else's land.

A few houses away, cracks mar the drywall of Erma Harris' bedroom and hallway -- gaps that match those found in neighbors' homes, suggesting foundations beginning to shift.

They may seem like small problems, commonplace in Cleveland's century-old housing stock. But to the owners of these nearly new houses, they're signs of the rapid deterioration to come -- structures that may not make it 20 years, much less into the lives of their grandchildren.

When construction began six years ago, the Villages was touted as the largest new development in Cleveland since World War II. The federal government chipped in $16.6 million to help build 465 houses in Central, home to Mayor Frank Jackson. Priced between $100,000 and $200,000, they were designed for working people with modest incomes -- many of them public employees and single mothers who had never owned a home. Generous second mortgages and 15-year tax abatements helped lower the prices. Jackson even threw in an extra $10,000 for the people who lived in his ward.

It all sounded too good to be true -- and it was.

Just three years after being sold, some houses already need major repairs. At least 22 people have signed a petition complaining about construction mistakes. One resident filed a lawsuit accusing the developer of poor craftsmanship and fraud.

But so far, their complaints have fallen on deaf ears. Mayor Jackson won't return their calls, though he lives just a few blocks away. The neighborhood development corporation considers these the normal hazards of home ownership. Rysar Properties, the developer, says much the same.

All of which leaves residents feeling trapped. Without money for major repairs, they worry about problems that will only get worse.

"Owning your own home -- that was a dream to most of us that moved here," Harris says. "But I didn't think we would almost be getting ripped off."

Welcome to the ghetto of the future.

On a cold March afternoon, Rysar president Ken Lurie weaves through Central in his gleaming black Lexus, puffing on a fat cigar. With his buffed loafers and geek-chic glasses, he looks more like a befuddled philosophy professor than the head of a multimillion-dollar company.

He brags about transforming vacant lots and crumbling houses into the cheerful suburban-style streets that now surround him. This is his empire. "Where you see vacant land, I'm either buying it or trying to buy it," he says.

By Lurie's telling, it all happened by accident. He stumbled into the development business about 14 years ago, when he bought and renovated a couple of houses. His family's clothing manufacturing company had recently been liquidated, and Lurie was looking for work. He slowly expanded to new construction. "I built a business on sheer ignorance," he says.

His biggest venture began a decade ago, when the federal Department of Housing and Urban Development (HUD) started giving out money to build houses for the working poor. The idea was to revive inner-city neighborhoods by increasing home ownership. Central, Cleveland's poorest neighborhood, seemed the logical place to start.

In 1997, HUD gave the city more than $16 million in grants and loans to finance the project. Twenty-nine developers submitted bids, according to a Plain Dealer report. It surprised no one when a politically connected coalition won out. Rysar partnered with minority-owned Bradley Construction and development giant Forest City -- the city's largest political contributor -- to form BFR Partners. They planned to build 420 houses and renovate 45 more around Central Avenue from East 36th to East 71st streets. HUD dictated that the majority be sold to people whose incomes were at or below 80 percent of the area median.

Nine years later, BFR has built more than 300 homes, and Lurie has become the largest builder in the city, specializing in inner-city housing. To succeed, he had to charm the right politicians, navigate Cleveland's tortuous bureaucracy, and still squeeze a profit from the city's poorest neighborhoods.

"I could not do what I do without the public assistance," he says. "It takes this kind of money to get people like us to do things."

In the last decade, Rysar has received at least $13.6 million in loans from the city, in addition to the $16.6 million the feds kicked in for the Villages.

Lurie, in turn, has been generous to politicians. Records show that he contributes regularly to city council campaigns and supported Jane Campbell in her first bid for mayor. Since 2004, Lurie, his employees, and relatives have given $9,000 to Jackson.

The mayor tapped Lurie to be his economic advisor during the last campaign. In Lurie's Chester Avenue office, a photo of him with Jackson hangs on the wall behind his desk.

Yet he insists he's not close to the mayor -- or anyone on the council. "I don't go to dinner with these guys. I'm a builder and a developer. I am not a politician, and I could care less about it."

In fact, he says, politicians need him more than he needs them. "None of them give me any special favors," he says of his campaign contributions. "It's not bribes."

Jackson, through his press secretary, declined to comment for this article.

But on East 46th Street, Lurie seems a very powerful man. Jackson may not return his constituents' calls, but when Ken Lurie's on the phone, you can bet the mayor picks up.

After living in public housing for two decades, Erma Harris was anxious to escape. She wanted to get her teenage son away from the violence and drugs that surrounded them at Woodhill Homes in Buckeye-Woodland.

So when a brochure for the Villages of Central arrived with her paycheck from the Cuyahoga Metropolitan Housing Authority, where she works as a maintenance supervisor, she jumped at the chance.

She paid $158,000 for her home. It may not seem like much in the outer suburbs, but $158,000 can buy a lot of house in Cleveland and its inner rings. Maybe that's why the structure's flaws infuriate her so.

As Rysar prepared to break ground in 2000, both the feds and the city laid down some ground rules. Jackson wanted contractors to hire neighborhood residents. He also wanted them to exceed federal and city quotas for hiring minority-owned companies. To accomplish this, Rysar divided the work into smaller contracts to make it easier for neighborhood subcontractors to bid.

It seemed a noble goal, but it also came with the presumption that nearly anyone can build a house. And that would prove a curse to homeowners: What neither Jackson nor the feds stipulated was the hiring of skilled labor.

By the time Harris moved in 2003, there was already a crack in her bedroom wall. Workers filled it in, but it reappeared, and there's another in her living-room ceiling. Meanwhile, her yard is sinking around the foundation of her house.

Before houses are built, the soil should be compacted, so that yards, driveways, and steps don't move. "A foundation that's put in properly should not move," says Frank Keeling, an organizer for the carpenters' union.

Harris says that Rysar's contractors addressed some problems in the first year. But now Rysar simply tells her that "the house is settling," she says.

Harris believes that Rysar exploited the ignorance of first-time home buyers. "We had never purchased a home," she says. "People tend to take advantage of that, when you just don't know."

Many of her neighbors feel equally duped. Aneesah Fleming paid $118,000 for her three-bedroom house in 2002. She saw an ad for the Villages in the paper, found out about the low down payment and 15-year tax abatement, and decided to go for it. The house gave her six kids a yard to play in. She didn't know it also came equipped with an endless supply of aggravation.

The stove broke after the first year. The garbage disposal leaks. Every week, Fleming changes at least three lightbulbs, and many of her electrical sockets don't work. She can't vacuum the master bedroom without blowing a fuse. "If the wind blows too hard, there goes the lights," she says.

The blown lightbulbs can probably be blamed on FirstEnergy, says Dennis Meaney of the electrical workers' union. However, the problem with vacuuming is likely caused by overloaded circuits. "That's a result of improper wiring."

Meanwhile, Fleming's porch steps are sinking away from the house, while her driveway now inclines sharply, driving rain toward the basement.

Rysar's workers didn't compact the soil under her driveway, says Bob Fozio, who's worked 42 years as a bricklayer and stone-mason. And her porch steps are sinking because they were built -- as were many of her neighbors' -- on top of her sidewalk, when they should have gone directly into the ground.

"What you're supposed to do is dig down to virgin soil . . ., pour this thing solid," he says.

Inside, Fleming's stairway is pulling away from the wall. "It has been a complete nightmare," she says.

In the beginning, Fleming says, Rysar came when she called. Workers even fixed an initial shift in her driveway 14 months after she moved in. But when the year-long warranty ended, it was harder to get Rysar's attention.

"When we talk to them, they're like, 'It's maintenance,'" Fleming says. Eventually, she didn't bother to call anymore.

Her neighbor to the back, Anthony Moore, shares her frustration. When he decided to put in a fence, he found out that his property line ends a few yards from his back door. That means his garage doesn't belong to him -- it was built on a neighbor's property. Meanwhile, his kitchen countertops are coming apart at the seams.

Rysar's errors, he believes, will make the house tough to sell. "I don't think anybody'd buy a house like that," he says. "This really was a sucker deal."

Maxine Singleton knows the importance of good handiwork. A plainspoken grandmother with dyed blond hair, she works in CMHA maintenance with Harris. After spending decades in public housing, both women now keep spotless homes, with plastic runners over the carpet and well-stocked pantries. What Singleton can't understand is why her $120,000 house has been the source of so many headaches.

"Give me what I paid for," she keeps saying.

When she first moved in, water was pooling in her basement, and workers had to dig up her backyard to fix a pipe. The ground underneath her driveway is sinking. One hole is large enough to house rabbits.

Her stove went on the blink after two years. She has a crack in her bedroom wall that matches those in her neighbors' homes. Her lightbulbs blow out every week, too.

When she complained about water pooling on her porch, Rysar covered it with a thin layer of concrete that soon started to flake off in large chunks.

Finally, Singleton got fed up. Last summer she went door-to-door, asking her neighbors to sign a petition complaining about their houses. She also sent a letter to then-City Council President Jackson.

"Mr. Jackson, you assured us that our house will last for 30 years," she wrote, "and at this current time these houses are currently falling apart as if they were made out of cardboard."

Asked if the mayor ever returned her calls, Singleton just laughs.

"Ha! As of today, nope."

The residents of Central finally took matters into their own hands. Last fall, Ruth Crowder filed a lawsuit, outlining a laundry list of problems with her East 43rd Street home.

Her suit accuses BFR and Rysar of fraud, alleging that they "engaged in a pattern and practice of building and selling houses in The Villages of Central that were constructed in an unworkmanlike manner."

(Rysar's lawyer, Kenneth Baker, disputes Crowder's claims and argues that the case never should have gone to court.)

At one point, Rysar offered to buy Crowder's house back. But her lawyer, Stephen Thomas, said that when he agreed to the deal, Lurie backed out because too much time had passed.

Crowder's suit asks for damages or a chance to reverse the sale of her house. The case is scheduled for mediation this summer. Crowder declined to comment for this story. But Singleton is unrepentant in her criticism of Rysar -- and Jackson.

"They messing with the wrong folks," she says. "He [Jackson] was the one that said he was gonna make sure things get done."

Those in the construction trades concede that small problems are inevitable in new construction, but sinking porches and driveways should not be among them. "That's just shoddy workmanship," says John Kilbane of the building laborers' union.

Adds bricklayer Fozio: "I never heard anything this bad in my life."

Nonetheless, such problems are widespread in Cleveland, say union members. After all, there's a financial advantage to hiring nonunion craftsmen: They can be classified as independent contractors, meaning developers don't have to pay workers' comp, unemployment, Medicare, and health benefits.

They tend to perform as well as they're paid, says Don Galea, an organizer for the carpenters' union. "You have an unskilled, unqualified workforce performing a lot of the work in the area," he says. "They cut corners. It's prevailing in the industry."

Yet government-subsidized housing doesn't have to be poorly built, they argue. Kilbane points to Arbor Park, a public-housing development a few blocks from the Villages. That project, by Marous Brothers Construction, is an example of "fine craftsmanship," he says.

Projects like the Villages of Central, which receive hefty public subsidies and tax abatements, should be held to a higher standard, argues Galea. "The taxpayers and the homeowners should get their money's worth."

But the problems lie as much with politics as they do with developers, says Councilman Mike Polensek. Every new mayor wants to brag about building thousands of houses. Jane Campbell made it a cornerstone of her administration. But since they're built so quickly -- with quality taking a back seat to political considerations -- problems are inevitable.

"I think in the haste to throw some of these houses up . . . there's been some very questionable work," Polensek says. He blames the city for handing out subsidies, then signing off on shoddy construction. Indeed, records show that a city inspector approved the construction of all the homes mentioned in this story without noting any problems.

"Some of these city inspectors need a white cane with a red tip," Polensek says. "Stevie Wonder could see some of this stuff."

For residents, Jackson would seem the perfect man to remedy the situation. He lives just a few blocks from the Villages, and he made his political bones on his reputation as a devoted servant of Central. But despite calls and petitions, the mayor pleads ignorance. Press Secretary Michael House initially said that Jackson was unaware of the complaints. He later called back to say the mayor was "concerned," though Jackson refused numerous interview requests.

It's a response Singleton could have scripted.

In her letter, dated June 1, 2005, she warned in forceful if slightly misspelled language: "We are currently starting a petiton concering this issue. We will forward a copy to you, so don't say you never received it."

Today, Lurie seems more eager to insult his customers than to address their complaints. He calls Singleton a "troublemaker" and suggests that Crowder is crazy.

"I offered to buy her house back 'cause she was a nutcase," he says. "She's not a hundred percent all there."

Lurie acknowledges that he didn't hire union workers for the project, claiming that there are "no union residential builders" in the area. But he's offended that anyone would even ask whether his work is substandard.

"You should take your paper and you should take your editor, and you should be ashamed of yourself," he tells a Scene reporter. "I do not build a cheap house. I build a high-quality, affordable house with first-class, quality building materials."

His development director, Rob Namy, disputes the idea that his workers aren't skilled. "It's not true," he says. "We hire skilled trades that build not just our houses in the Villages of Central, but our houses in Shaker Heights."

Lurie admits that he has "issues with the land sometimes, where it sinks." But he doesn't think the problems are his fault. "Things can warp, ground can sink. Things can happen; it's not because of deficiency in our building quality or anything like that."

Cracked walls and stairways that separate from walls are simply signs that the house is shrinking, says Jeff Marks, Rysar's point man for the Villages. Moisture makes lumber expand and contract, he explains, while drywall cracks because it has no give.

Marks blames electrical problems on FirstEnergy. He says the wattage in that area is too high, and he has complained to the Public Utilities Commission about it. (A commission spokeswoman confirmed this, though the office hasn't heard from Rysar in a year.)

Lurie says that he would fix many of the problems if he only knew of them, but residents don't always report their concerns to Burten, Bell, Carr, the neighborhood's development corporation. "They all know they can go through Burten, Bell, Carr," he says. "It's bullshit."

Tim Tramble, executive director of Burten, Bell, Carr, also defends Rysar's work. He notes that 330 houses have already been built, and "Most people that I talk to, they're very happy, they're very excited."

After seeing Singleton's petition, Tramble's employees went door-to-door and held a meeting with Rysar and the residents. But the neighborhood group also has an incentive to support the project. It gets a $1,250 fee for every house that's built.

"We're not in the bed together," Tramble says. But he is a cheerleader. "This is a wonderful project, a wonderful program. It's just a phenomenal story."

He believes that first-time buyers have "unrealistic expectations," arguing that such problems are inherent in home ownership. He estimates that he and his wife have already spent $30,000 on repairs for their decade-old home. "It's very typical that after two or three or four or five years, things begin to happen. It's the homeowner's responsibility."

By now, many Villages residents realize they must pay for repairs themselves. But most spent almost everything they had to buy their homes; they can't afford to fix major problems.

"The houses weren't built to last no 30 years," says Singleton. "They were already fallin' apart before we came in."

Polensek predicts that in 20 years, when today's new homeowners lose their tax abatements and realize that they don't have the money for repairs, a wave of people will simply abandon their homes.

"These houses . . . They are built like a stack of cards," he says. "There will be a point down the pike where we'll have some of these new homes falling apart."

For residents, there's no easy escape. If they sell before five years have passed, they have to pay back their second mortgages with interest. They also wonder who will buy their homes.

"I'm not gonna be able to sell this house," Fleming says. "I know I'm not."

Fozio shares her concern. In 20 years, he says, "You probably got a worse ghetto than what they had when they tore these houses down."

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