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Helmut Schmidt, Published May 29 2010

Fargo’s buyouts don’t go up for sale

Fargo, unlike Moorhead or Cass County, doesn’t resell homes on the Red River it purchases in its buyout program – and city officials say that’s unlikely to change soon.

Instead, Fargo follows a strategy that’s a mix of salvage, demolition and home moving.

Working with home sellers, Habitat for Humanity and construction firms, the city’s idea is to contract with firms to clear homes off lots fast so levees and floodwalls can be built.

That’s how it worked for 24 homes Fargo purchased for $7.1 million in 2009, and that’s how it’s shaping up this year, officials say.

It’s not that the city is averse to making a buck back for the taxpayers, City Administrator Pat Zavoral said Friday. It’s that the homes sell for pennies on the dollar and they are tough to move.

About 40 homes were purchased in the mid-1990s when the city built its water plant, he said. The sale netted about $80,000. But, because Fargo is urbanized, there are large trees and power lines to move homes around.

“That sort of showed us it wasn’t practical for us to do it (move homes) in the inner city,” Zavoral said.

Similar problems popped up in the northside Ridgewood area after the 1997 flood, Zavoral said. Contractors only got one home out, he said.

Fargo bids out home salvage and demolition contracts, Zavoral said. Firms awarded contracts to give the city a discount on demolition if they get salvage rights.

Homeowners and Habitat for Humanity may get to salvage items, too, which can leave homes as shells.

“We’re still dealing with people’s homes,” Zavoral said. “We’re trying to respect their emotions, too.”

This spring, the contract for Industrial Builders to salvage and remove homes was extended under the flood emergency. It paid off for the firm on one property when it sold a home at 701 Harwood Drive S., carved it into sections, and moved it before the river rose.

If the company had needed two more days, the $1.15 million house would have been kindling, said Senior Engineer April Walker. All contracts call for the city to get bare ground.

Four homes will be torn down this summer, said Assistant City Attorney Butch McConn. Two homes that are getting levees built in their backyards might be sold in an exception to the rule, he said.

On Thursday, Cass County netted $326,250 from the sale of 35 buyout homes and other buildings. They were purchased with nearly $9 million in federal, state and local funds.

County Auditor Mike Montplaisir said the county’s experience has been consistently positive.

“It makes every sense in the world” for the county to get more buyout funds by reselling homes,” he said. “It saves a lot of money.”


Readers can reach Forum reporter Helmut Schmidt at (701) 241-5583