$50m demolition fund passes Cuyahoga County Council unanimously

Cuyahoga County will soon give cities tens of millions of dollars to tear down blighted buildings. A $50 million bond issue for demolition, debated all year, passed the county council unanimously last night.

The aggressive action addresses one of Cleveland’s most urgent and overwhelming problems. Many city neighborhoods are still scarred by abandoned homes from the recession and foreclosure crisis.

“No one has done anything as ambitious in this nation as $50 million,” said councilman Pernel Jones, a strong supporter of the legislation.

The vote, seven days before Election Day, gave county executive Ed FitzGerald a new accomplishment in the last days of his run for governor. It also affected the race to replace FitzGerald. Jack Schron, the county councilman who’s the Republican candidate for county executive, voted for the demolition plan, even though his attempts to amend it failed.

The council’s Republicans and Democrats ironed out their differences about the demolition program by approving 11th-hour amendments.

The council adopted Republican Dave Greenspan’s idea of letting cities apply for a grant or a loan. The idea is to stretch out the $50 million bond issue, which isn’t nearly enough to demolish the area’s estimated 20,000 abandoned homes. If cities go for a loan, they’ll get a grant of half the loaned money when they pay it back. Cities are expected to apply for grants at first, then loans as the fund dwindles.

Schron's amendment lost 9-2. He wanted to make the grants competitive and establish an independent review committee to make the awards.

“If we don’t change this, that means the county executive, whoever that’ll be, will be making the determination of how the money will be utilized,” Schron said. But council went instead for Pernel Jones’ amendment, which says council intends to create a committee to oversee the program.

Schron dropped his earlier idea of favoring demolition applications for land with high development interest. The county’s bond counsel advised that restrictions on the use of sales tax bonds prevented it.

Schron’s vote for the final legislation prevents his opponent in the executive race, Democrat Armond Budish, from making demolition a defining issue a week before the election. Budish has said he “strongly supports” the program.

FitzGerald adopted the $50 million demolition proposal in his February State of the County address. (Former county treasurer Jim Rokakis had promoted it for years before.) At the meeting’s end, Democratic councilwoman Sunny Simon praised FitzGerald’s leadership on the issue. Her remarks contrasted with complaints two weeks ago from Greenspan and council president Ellen Connally, who said FitzGerald had offered a vague proposal and left the details to council.

The county will borrow the $50 million and pay it back over several years -- despite concerns that county is already borrowing heavily to finance projects such as the convention center hotel.

The county council went forward despite complaints from Cleveland city councilmen Zack Reed and Jeff Johnson that favoring demolition over rehabilitation might hurt the historic character of their neighborhoods. County councilwoman Yvonne Conwell argued two weeks ago that some of the money should go to rehabbing houses, but she also dropped her idea on the advice of the bond counsel.

The Cuyahoga Land Bank will get $9 million to demolish properties it owns. Cities will be able to apply for up to $1 million in the first round of funding and possibly $2 million in later rounds. Every city that shows a need will get an award. Once a city uses 80 percent of the award, it can come back for more.

Under that system, most suburbs will get the money to demolish all their eligible blighted buildings in the first round. The cities with the greatest need -- Cleveland and East Cleveland, and perhaps a couple more inner-ring suburbs – will come back for many later rounds.

Here's the full text of the final ordinance.

The politics of demolition put Schron on the spot in the executive race

After a lot of talk and months of negotiations, the Cuyahoga County council is poised to approve a $50 million plan to demolish thousands of blighted houses – just before Election Day.

That puts county executive candidate Jack Schron -- a Republican county councilman – in a political bind. He wants a different demolition strategy. How will he vote?

“This might be our one shot at spending $50 million,” Schron said at a council meeting yesterday. “If we spend it before we’ve ever put the comprehensive plan together, we’ll put the cart way before the horse.”

The demolition plan is heading for a vote Oct. 28. Will Schron vote no, a week before the county executive election, and create a contrast between himself and his opponent?

The idea of borrowing $50 million to battle blight has been in the works a long time. Former county treasurer Jim Rokakis and various political candidates suggested it, and executive Ed FitzGerald adopted the idea in his February State of the County address. But it had languished in council for months.

Yesterday, the legislation picked up speed. As the council hashed out details, political tensions flared.

Dave Greenspan, the frugal conservative, argued for loaning money for demolition instead of making grants. Yvonne Conwell, who represents much of Cleveland’s East Side, argued that some of the money should go to renovations. The mayors of Shaker Heights, Lakewood and Parma addressed the council, arguing some of the money should be guaranteed for inner-ring suburbs.

Greenspan and curmudgeonly council president Ellen Connally, both critics of FitzGerald, complained about him again.

“This matter was talked about, and suddenly the executive announced it was going to happen,” Connally said, “and we didn’t have any legislation. So we really had to do the down and dirty work.”

Pernel Jones, also from Cleveland, took the lead in arguing for the legislation as written.

“I thought it’d be a whole lot easier to give away $50 million,” Jones said with a smile.

That left an opening for Schron, the manufacturing CEO who seeks efficiency in government.

“It probably is easy to give away taxpayers money,” Schron replied. But even $50 million isn’t nearly enough to tear down all of the estimated 15,000 abandoned buildings in Cuyahoga County.

So Schron, who built his company’s headquarters on a Cleveland brownfield, argued that the demolition program should work more like the state’s brownfields program. He said it should favor sites where a business wants to develop and banks want to invest, near economic development engines such as the Cleveland Clinic.

“The comprehensive plan should come before the money starts to get spent,” Schron argued.

Dan Brady, rumored to be a top contender for council president next year, challenged Schron.

“Plans can get more and more and more comprehensive and never happen,” Brady said. “I’ve seen it over and over and over in government.”

Soon after, Connally called for the legislation to move forward. Council members can propose amendments over the next two weeks, she said.

“Is it the intent that we would be voting on this final legislation in two weeks?” Schron asked.

“It is our anticipation that we vote on the final legislation in two weeks,” Connally replied coolly.

“Will there be no other opportunity for public participation?” Schron asked.

“The public has had every opportunity to come to our meetings, to submit information,” Connally said.

Schron looked peeved. He shook his head, ever so slightly, and said he’d offer an amendment.

After the meeting, I asked Schron if he was frustrated. He said he wanted more time to get the council to consider his ideas. He smiled and said he might hold a press conference about the issue.

I asked if he’d vote for the demolition fund if his amendment is defeated. “I’ll have to wait and see,” he said.

Across the room, Brady was talking with a focused confidence, as if he’d taken the temperature of the room and found it to his liking.

I asked if he had the votes to pass the legislation as it is now.

“Yes,” he said.

What about the amendments still to come?

“If the legislation gets to a place where it’s not going to work, I’ll no longer support it,” Brady said.

Would Schron’s amendment keep it from working? “Yes, and it would take us another six months,” Brady claimed. Blight in Cleveland will get worse if the city can’t tear down abandoned homes, he argued. “It’s an emergency situation.”

Schron can’t be happy that the council’s Democratic majority is forcing him to vote on the demolition plan seven days before Election Day. But if he has to take a stand, he seems ready to use it as an example of how he thinks differently.

He’s trying to make the demolition program business-friendly, to open up land with blighted buildings on it for development. It could be a good way to grow the tax base. But, it could also mean less demolition in city neighborhoods where the real-estate market has hit bottom.

Armond Budish, Schron’s opponent in the executive race, says he “strongly supports” spending the $50 million. So if Schron’s amendment gets shot down, he’ll face a tough vote Oct. 28. Does he vote no and position himself as the more cautious spender, even though Budish may use that vote against him in the city? Or does he vote yes, for a proposal he thinks could be better, to assure voters he’ll take on the blight issue if elected?

Kevin Kelley talks vacant housing, council discipline, East Cleveland merger

My Q-and-A with Kevin Kelley, Cleveland’s new city council president, is out now in the March issue of Cleveland Magazine.

Kelley’s election may lead to a more assertive city council than we’ve seen in eight years. His predecessor, Martin Sweeney, valued cooperation with Mayor Frank Jackson and let the mayor's office set civic priorities. Kelley’s agenda for 2014 includes initiatives on vacant housing and gun violence, both still in the study stage.

The 45-year-old councilman from Old Brooklyn talked with me about his insistence on better discipline and decorum in council, his plans to step up home demolitions, and his thoughts on whether Cleveland should annex East Cleveland. Here’s an extended version of his answers. You can read his comments about why he supports extending Cuyahoga County’s alcohol and cigarette tax for stadium repairs in this blog post.


CM: What are your plans for vacant housing?

KK: The council has commissioned a study to look at the effect of demolition and how it affects property values. We need to aggressively attack these houses. Some homes are candidates for restoration, but what’s really causing the devaluing of real estate is the 5,000 we can all agree need to come down. The biggest challenge is not identifying the houses to come down, but identifying the money.

CM: Councilman Jeff Johnson will often make the case: I don’t just want demolition, I represent a historic neighborhood, I want some of these properties preserved, and I want to find money for that too.

KK: Certainly there are some [houses] that are candidates for restoration. But the biggest part of the problem is those that must come down. Even councilman Johnson or those who are active in the historic preservation community would agree that there are homes that are beyond saving. It’s bringing all of our property values down.

CM: At a retreat just after New Year’s, you told councilpeople to show up to meetings, show up on time, understand what they’re voting on, and pay attention to testimony. But only 10 out of 17 councilpeople attended your retreat. Does that prove your point?

KK: No. That was something I wanted to do before we started the session. I knew it was during the holidays, some people told me they were out of town visiting family. If it were held while we were in session, I’m confident we’d have 100 percent participation.

Look at attendance and punctuality since that retreat. Every meeting has started within 3 minutes of its starting time. We’re acting in a more professional manner. I think we’re taking things more seriously. I’m trying to make people more cognizant of the fact that when you sign your signature or cast a vote, millions of dollars are appropriated. When you consider the enterprise funds and the general fund, we appropriate over $1 billion a year. That’s something we need to be aware of, and that’s why I insist everybody be at their seats when the roll is called.

There was not a lot of chatter during the legislative portion of the meeting. There was not a lot of roaming around. The directors have agreed to come to meetings 10 minutes early to discuss any issues councilmembers might have so that please don’t have to roam around during the meetings. Overall, these changes are being accepted by my colleagues.

CM: What do you think about talk of Cleveland and East Cleveland merging?

KK: We need to commission a study that will look at whether this makes sense for both communities. It’s an intriguing opportunity, but we need to look at the cost of providing services to East Cleveland. There’s a lot of risk, but a lot of opportunity. It’s too early to say whether it’s definitely something we should or should not do. We need to take a very sober, thoughtful approach to this.

CM: What are the risks for Cleveland?

KK: The risks are that our budget is very tight. There’s not a lot of extra money. Our biggest challenges are providing safety forces. They take up 55 percent of our budget. Are we able to extend that level of service to what would be a new part of the municipality? Are we able to deal with the infrastructure challenges that East Cleveland poses? We have our own infrastructure challenges, in terms of the conditions of our roadways.

CM: What are the opportunities for the city?

KK: The opportunities are, there’s a lot of gems in East Cleveland. There’s a lot of nice old houses, parks, industry — [GE’s] Nela Park is still there. They have big city problems on a small city budget. If we come together, and that helps our ability to bond projects, can we be better together because of our now increased population, income tax and property tax values?

When we look at the big-city problems some of our inner-ring suburbs are facing, it’s an opportunity to demonstrate to other communities that by coming together, we can solve these problems together. We can make this work, we can do a merger and keep the local character, but get the benefit of working together.

CM: Could this pave the way for other mergers in the future?

KK: If it’s determined that it’s in Cleveland’s interest, and it is done well, and it can demonstrate that because of its merger, East Cleveland is in a much better position and Cleveland is in a better position — then yes, it can be seen as a transformative step that other communities can take and [a way] we can build a better Greater Cleveland.

CM: What was it like to be Kevin J. Kelley when a J. Kevin Kelley in the town next door was indicted on corruption charges?

KK: That was an interesting time! When it first happened, there was quite a bit of confusion. A couple of callers to my office were “so disappointed” in me. It was a tough time. With each subsequent headline, the effect on me lessened a little bit. But every now and then, one of my friends’ moms would say, “Oh, I know Kevin’s going to be OK. I know he didn’t do anything.”