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Judiciary & Civil Jurisprudence Arbitration Hearing, Video of Homeowners Testimony Advance to 1:55

Billions for Home Builder Corporate Welfare from Washington 
 New York Times, by Gretchen Morgenson
 
* Read and Post Remarks in The Huffington Post 
American Banking News: Tax Breaks Worth Billions to Big Business
* Related Articles:  NY Times: Building Flawed American Dreams 
* Rise and Fall of Predatory Lending and Housing
* Builders rake in refunds * See Forbes Magazine Article

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Mirasol Housing Athority/KB Homes in the news again
Sunday, 08 May 2005

Subdivision's residents see woes ahead
... the Villas de Fortuna subdivision, a part of the federally funded Mirasol Homes project that has drawn public criticism for its quality of construction. The bubbling floors make them fear the worst — that rainwater is oozing up through the concrete foundations of their 4-year-old homes. SAHA spokeswoman Melanie Villalobos said that because foundations are a warranty item, any findings will be turned over to the homebuilder. But staff inspections by SAHA might not be enough for U.S. Rep. Charlie Gonzalez, who wants them done by an independent expert... In addition to the bubbling linoleum, Raymond has other reasons to believe his foundation has problems. Doors don't open and shut properly. Sheetrock on the walls has cracked and some ceiling Sheetrock had separated from the walls. Related articles: Mirasol huge profits for builder, Mirasol Homes Hearing

Subdivision's residents see woes ahead
05/08/2005
Ron Wilson
Express-News Staff Writer

Though they'd been neighbors for years, Kevin Raymond and Jose Flores learned only recently they have something strange in common.

When it rains, the linoleum in front of their refrigerators bubbles up. It never happens during a dry spell or when something spills on the floor. Only when it rains.

Both men live in the Villas de Fortuna subdivision, a part of the federally funded Mirasol Homes project that has drawn public criticism for its quality of construction. The bubbling floors make them fear the worst — that rainwater is oozing up through the concrete foundations of their 4-year-old homes.

Raymond and Flores are participating in a lease-purchase program managed by the San Antonio Housing Authority, which promised last week to schedule foundation inspections.

SAHA spokeswoman Melanie Villalobos said that because foundations are a warranty item, any findings will be turned over to the homebuilder.

But staff inspections by SAHA might not be enough for U.S. Rep. Charlie Gonzalez, who wants them done by an independent expert.

"If SAHA or the homebuilder want to do their own inspections, that's fine, but SAHA needs to hire an independent, credentialed inspector to do an objective study," said Gonzalez, a San Antonio Democrat who became interested in problems at Fortuna after a constituent complained.

Fears about their homes' foundations took on graver significance for Raymond and Flores this spring, when SAHA sent them letters saying they had to secure their mortgage within a year or move out. They both thought about dropping out of the lease-purchase program and moving, but they'd lose the $10,000 or so that's built up in their down payment accounts, which can't be transferred to another house under SAHA's current rules.

Gonzalez said he would suggest they seek legal advice.

"They need to know if there's any way out from under this agreement if they choose not to buy their homes," he said.

Villalobos said late last week that SAHA is reviewing parts of the lease-purchase program, and she vowed the agency will work with all participants to help them buy their homes.

The problems with the houses and the lease-purchase program at Fortuna baffle former SAHA Commissioner Bob Beltran, who served when the program was established in 2000.

"When staff told us about the lease-purchase, it seemed great," he said. "We were going to help the poorest of the poor get their own homes for the first time in their lives. That was supposed to foster safe neighborhoods and good neighbors and do away with slums.

"Looking back now, with President Bush talking about his idea of ownership, SAHA was really ahead of its time," Beltran said. "I don't know what happened to the program to make it go south."

But after a forgotten landfill at another section of Mirasol was rediscovered, Beltran said, SAHA lost interest in everything else, and off-site subdivisions such as Fortuna never came up again.

In addition to the bubbling linoleum, Raymond has other reasons to believe his foundation has problems. Doors don't open and shut properly. Sheetrock on the walls has cracked and some ceiling Sheetrock had separated from the walls.

Neighbor Amelia Sanchez has water-related foundation problems of her own.

When it rains, runoff erodes the soil and exposes her foundation. It also has washed away the narrow strip of yard between the house and a slope that goes to a drainage ditch in her back yard.

The ditch channels runoff through about 20 Fortuna yards to Zarzamora Creek 100 yards farther downhill.

Though Sanchez has been complaining about the problem for three years, only minor repairs were done, and they didn't last. Maintenance people who came by told her there were only two ways to fix the problem.

"They said they could build a cement wall or something to take water away from my house," she said, "or they could bring in four 18-wheelers of gravel."

Apparently, Sanchez now will get both. A crew started work Friday on a retaining wall that will extend over two yards. After that, Villalobos said, a back porch will be replaced, the yard will be filled in and sodded, and a sprinkler system will be installed.

Asked why she picked a house with a steep back yard, Sanchez said she didn't pick it. SAHA did.

"They said this was the only house left here, and if I wanted in the (lease-purchase) program, I needed to come by and sign the papers and get the key. And, that's what I did. It was my dream to own my own house. I never got to see inside (before getting the key)."

Responding to Sanchez's complaint, Villalobos said, "No potential homebuyer should ever be rushed into a decision or assistance program."

SAHA representatives are continuing to meet with Sanchez, she added, and hope to help her resolve her problems.

Sanchez's neighbor two houses up, Rosizela Figueroa, has wondered about her foundation since she noticed something peculiar two years ago. She dropped a pencil on the floor, and instead of just staying where it fell, it started rolling toward the back wall.

The Fortuna drainage ditch runs through her back yard. Once when the ditch was a knee-deep raging arroyo, she took pictures and gave them to SAHA. A year later, she mentioned the problem again to the agency. A staff member looked for the photos in her client file, but they weren't there.

When asked about the missing photos, Villalobos said that according to SAHA policy, all evidence of complaints supplied by residents should be kept in the client file, but no such pictures could be located.

For Gonzalez, the litany of issues just underscores the need for SAHA to get an independent expert.

"You know, a couple of years ago, SAHA did that. They called in a forensic architect to look at the houses at Mirasol. And he provided some insightful observations. He said there would be maintenance problems with the houses in five years. Of course, HUD then said, 'That's OK, because the houses meet minimum standards.'

"But his observations were all the more valuable precisely because they were independent and objective."

Gonzalez suggested SAHA's independent expert take a three-prong approach.

"First, we need to look at the obvious issues, like the ditch in the back yards and foundations. These problems can easily be quantified.

"Second," he said, "can anything be done to help the residents who don't want to buy these houses?

"Then, we need to look at SAHA's performance in educating residents about purchasing a home."

The evaluation of SAHA's performance is not a new idea.

Two years ago, SAHA commissioners planned an independent audit to find out how the Mirasol project was managed. But Mayor Ed Garza asked all those commissioners to resign, saying they were dysfunctional as a group.

The new board he appointed then nixed the management audit, saying it would be too expensive.

Though Sanchez repeatedly said she didn't want to cause trouble, she added there are two things she'll battle for: her family and her home.

"This is my home. This is my dream, to own my own home. I'm not going to give up without a fight."


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