The likely demolition of a vacant house in Shelby Park has led some to question the Landbank Authority’s responsiveness in underserved communities where most of the city’s vacant houses are located — at the same time, the authority is facing mounting criticism of its effectiveness.
The Shelby Park home, located at 423 E. Ormsby Ave., was purchased by Wendy S. Meadows in December 2017 through the Landbank’s Last Look Program, which it started in October 2017. The program allows investors to buy vacant structures that would otherwise be demolished for $1 as long as the new owners provide proof that they have the funds to pay for exterior renovations and structural repairs.
At its meeting on Sept. 10, however, the Landbank board approved Meadows’ request to change the purchase agreement terms to allow the house to be demolished. Cory Meadows, the owner’s husband, told Insider Louisville the change was necessary because of malfeasance by a contractor, who the couple says they are now suing.
Roughly two weeks later, the Landbank Authority came under increased scrutiny after the Kentucky Center for Investigative Reporting found nearly a third of the properties that the Landbank has sold since 2010 were vacant and in violation of the city’s property maintenance code, including 31 that were sold to the property management company Mirage Properties LLC for $7,100.
The story led to an inquiry from the Metro Council’s Community Affairs and Housing Committee, which questioned Laura Grabowski, the director of the Vacant and Public Property Administration, on Oct. 17. The matter was continued until Oct. 31; however, that meeting has since been canceled.
“Up until last year, we didn’t have a way to sell properties that were in the status of demolition,” Grabowski told the committee. “That is where the Last Look program came from. I know there are some questions about it. We were able to get rid of some properties that we would have needed to demolish.”
She noted that it costs the city $9,000 to demolish a house.
Cory Meadows said he and his wife are getting caught up in the backlash from the other Landbank controversies. The Shelby Park Neighborhood Association has been critical of the demolition.
The couple has lost tens of thousands of dollars due to the contractor’s actions, Cory Meadows said, and the damage done to the home made it unfeasible to continue the renovation. They hope to use the land to construct something the neighborhood will find useful or at least sell the property, which is valued at $40,000, to someone else who will.
“We are not these big investors coming in to make money off the community. We are a couple who flipped a few houses and then had some bad luck. We got involved because we liked what was going on in Shelby Park, and we wanted to be a part of it. We still do,” he added.
Chip Rogalinski, president of the Shelby Park Neighborhood Association, said his organization did not learn about the demolition notice until it was almost too late because the city initially sent out the notice with the wrong address.
A second 30-day notice was issued and expires on Oct. 30. Meadows then would have 30 days to arrange for the house to be demolished.
Rogalinski said the loss of the home could have been avoided if the Landbank Authority had been proactive in getting his organization involved in the situation.
“It would be different if we weren’t organized and didn’t have a history of reducing vacancies in our neighborhood,” Rogalinski said. “We are doing what everybody else is talking about doing, and the Landbank was aware of it because we have been trying to secure these vacant properties.”
For the last three years, he said, the neighborhood association has been working to reduce the number of vacant properties, even loaning $50,000 to the New Directions Housing Corp. to save homes. The association has partnered with New Directions and River City Housing to save six other homes on East Ormsby Avenue.
The Meadows allowed the association to tour six contractors through the home on Oct. 23 to see if they thought it would be saved. However, Rogalinski said, in its current condition, renovation does seem too costly.
Jessica Wethington, communications manager for Louisville Forward, said the authority followed the Last Look program process in selling the property and in giving the owner permission for demolition.
“Staff and the owner worked diligently to find an alternative to demolition, but ultimately, rehabilitation was found to be cost prohibitive, given the structure’s current condition, the investment already made and the additional investment needed. After reviewing the documentation, staff recommended the Landbank Authority release the restriction requiring the owner to rehabilitate the structure,” Wethington explained.
David Netherton, a carpenter who lives next door to the Ormsby property, said it has been vacant since he moved to Shelby Park five years ago. Netherton considered buying the property himself, he said, but he could not get the necessary financing, even though he could do much of the work himself.
Netherton is still hopeful something good will become of the property even if the house is gone, he said.
“I hate to see another vacant lot on my street,” he said, “but even an empty lot is better than what I’ve been staring at for five years.”