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Few details to be found in subpoenas targeting Detroit demolition program

Under Mayor Mike Duggan, Detroit has used federal anti-blight funds for an aggressive demolition campaign.
Sarah Cwiek
Michigan Radio

We now know the contents of two federal subpoenasissued to the Detroit agencies running the city’s building demolitions program, but they don’t tell us much more than we already knew about an ongoing investigation.

The Detroit Land Bank and Building Authorities received the subpoenas in May.

They demanded the agencies turn over basically everything they have related to federally funded demolition contracts since the start of 2014.

The U.S. Treasury has allocated Michigan more than $380 million for demolition and blight elimination programs from its Hardest Hit Fund. That money was originally intended to help homeowners avoid foreclosure.

The lion’s share of that money — about $260 million — was set aside for Detroit. Under Mayor Mike Duggan, the city has used some of it to demolish more than 10,000 vacant homes and buildings so far.

The fact that the program faced a criminal investigation over alleged bid-rigging, inflated pricing, and other questionable practices has been known for months. In October, Duggan announced that the Treasury had briefly suspended HHF funds for Detroit demolitions until new changes and oversight were put in place.

The subpoenas give us few further specifics about the investigation, other than to confirm that it’s wide-ranging.

The Land Bank’s subpoena demands “all voicemail communications and records of telephone calls,” meeting minutes and notes, and appointment schedules “pertaining to HHF demolition contracts” from a number of land bank employees and board members, as well as their communications with certain demolition contractors and the Michigan State Housing and Development Authority.

The Building Authority’s subpoena asks for the same information from a number of current and former employees, but also includes emails and text messages.

The Land Bank released the contents of the subpoenas Friday, ahead of a judge’s order to unseal them in court Jan. 12.

“The DLBA and DBA have fully cooperated and complied with this subpoena and the ongoing investigation,” Land Bank spokesman Craig Fahle said in a statement. He added that the subpoenas had been kept under wraps at the government’s request, but the agency decided to release them now after Wayne County Judge Robert Allen’s court ruling this month “gave us clear guidance.”

The subpoena demanded the information be provided by June 10. Federal agents paid a visit to the Detroit Land Bank offices last month to pick up more potential evidence; Fahle was unable to say what that was.

The investigation, spearheaded by a U.S. Treasury Special Inspector General (which issued the subpoena) with help from the FBI and Detroit U.S. Attorney Barbara McQuade’s office, have been very tight-lipped about it, providing almost no details beyond confirming that it exists and is ongoing.

So it remains unclear whether the investigation will be wrapped up, and charges potentially filed, before the incoming Trump administration takes over Jan. 20.

Sarah Cwiek joined Michigan Public in October 2009. As our Detroit reporter, she is helping us expand our coverage of the economy, politics, and culture in and around the city of Detroit.
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