Sunday, June 19, 2011

Dumb economic decisions are the hallmark of government agencies.

Caltrans-owned homes get costly new roofs

Roofs installed on more than 30 Pasadena-area homes cost taxpayers an average of $71,000 — far higher than a typical homeowner would pay. Caltrans has owned the properties for decades, awaiting a freeway extension.

By Jack Dolan, Los Angeles Times

The roof on the three-bedroom Pasadena rental where Don Jones used to live seems unremarkable until he hands over the invoice showing what it cost: $103,443.

Fortunately for Jones, he didn't have to pay that. His landlords, California taxpayers, footed the bill.

The state Department of Transportation, which bought the houses on Jones' block decades ago to bulldoze for an extension of the 710 Freeway, also spent $103,472 to replace a roof across the street and $80,606 to install the one next-door, agency records show. On a nearby avenue, a once-grand house, now dilapidated, sports a $171,508 roof that was put on in 2006 even though nobody lived there.

Document: Caltrans' bill for new roofs

"Looks like they put a million-dollar roof on something that's not worth saving," said Robert Richardson, a retired Caltrans employee who handled rental of the properties and agreed to a tour of the neighborhood recently. "This house has been vacant for at least a decade."

The prices are four to five times what most homeowners could expect to pay for a new roof on a similar house in the area, said Kim Smith, a contractor at J.N. Davis Roofing who said he has been fixing roofs in Pasadena for nearly 30 years.

"This is such a waste," Smith said.

The houses are among more than 500 the agency bought in a swath of Pasadena, South Pasadena and Los Angeles along the planned freeway's path. In response to a Los Angeles Times public records request, Caltrans provided documentation of 33 roof repairs and replacements between 2005 and 2010 on houses the department owns in Pasadena. The average cost to taxpayers was $70,994, the records show.

In addition to putting on new shingles, many of the jobs included replacing the wood supports beneath the roofs and the trim around the edges. Others included smaller repairs, such as gutter replacements and paint touchups, records show. Some garage roofs were repaired too.

The expenses were challenged by three private contractors and a state agency that reviewed the records at The Times' request. A state lawmaker who represents the area, a longstanding critic of Caltrans' ownership of the houses, has demanded an investigation.

"I'm very, very alarmed," said Assemblyman Anthony Portantino (D-La Cañada Flintridge), who asked the Assembly's government accountability committee, of which he is a member, to investigate how the costs climbed so high. "If there are questionable practices here, we need to get to the bottom of that."

Jones, who was evicted in late May in a dispute with Caltrans that began over the roof, said he hadn't asked to have the old one replaced because he never had a problem with it. But the new one leaked, he said, bringing in more than rain water. "Bees were also coming in.… It was like a plague," Jones said.

Caltrans does not rely only on tenant complaints to decide when to install a new roof, said department spokeswoman Deborah Harris. She could not say what prompted the replacement in Jones' case.

Andrew P. Nierenberg, the Caltrans deputy director in charge of managing properties in the Los Angeles region, said the costs are so high because many of the houses — which may still be bulldozed one day or sold if the freeway plan is scrapped — are historic landmarks and must be expensively retrofitted when repairs are needed.

"I have to go through this very detailed process of submitting all the plans to the State Historic Preservation Office," Nierenberg said. "This is not like a roofing job, it's more like a restoration job."

And it's not just top-of-the-line shingles running up the bills — although those chosen for Jones' house by Caltrans' in-house architectural historian cost $32,000. Taxpayers also shelled out thousands of dollars to replace rotten wood and waterproof sheeting that had been neglected for decades because of state budget crises, Nierenberg said. The state has owned most of the houses since the late 1960s and 1970s.

Milford Wayne Donaldson, who runs the State Historical Preservation Office and reviewed the Caltrans documents at The Times' request, said blaming the high price of the roofing on historical standards is "bogus." The shingles, which are made of asphalt but look like cedar, were only about a third of the overall cost of the roof on Jones' home.

Donaldson said that disposing of old shingles cost $10,000 for one neighboring home and $8,000 for another. The agency also spent $3,000 to replace some rotten wood.

"That's an awful lot," said Donaldson, an architect and former contractor who said he had overseen hundreds of roof replacements.

He also noted a "whopping fee" tacked onto each project. Broken into a series of separate charges, the fee went to the Direct Construction Unit, a small arm of the state's General Services Department. It amounted to nearly 20% of the cost of each job, the records show.

Documentation for Jones' roof shows a 7% "DCU fee," a 7% "contingency" fee, a 2% construction design support fee and a half-percent charge labeled "warranty." The agency also added a "contract administration" fee of $2,210, which amounts to an additional 2%.

"This is the percentage that we have to charge to cover our costs," said Eric Lamoureux, acting deputy director of General Services. The money pays for drawings, photographs, inspections, permits and "handling [Occupational Safety and Health Administration] issues."

He, too, cited historic preservation requirements, along with the need to replace underlying roof supports, as a primary reason for the high costs. But records show the same fees on a $95,626 roof replacement for a "non-historic structure" a few blocks away, also in 2006.

Asked about that job, Lamoureux said in an email, "I misspoke previously in referring to all of these projects as historic structures."

Nierenberg, the regional Caltrans deputy, conceded: "This is very high for a non-historic property.… The total project price, the total project labor, seem unreasonable."

The people who managed that project have since retired, Nierenberg said.

He also said he couldn't offer details about why the department evicted Jones and his wife, who has Alzheimer's disease, from the house they had lived in for more than a decade. Jones, 65, said he had argued with four state construction workers in 2006 after complaining that the new roof leaked.

Ultimately, Jones said, Caltrans offered him a confidential $20,000 settlement to leave quietly. Then, on June 6, a department lawyer sent him an email threatening to try to take the money back after learning that he had spoken to The Times.

Caltrans' decades-long ownership of the houses in the path of the proposed freeway has been a constant sore point for residents, historical preservationists and local elected officials, many of whom want the state to sell the homes back to private owners who could maintain them.

Responding to complaints in the 1990s that the properties were becoming run-down, the department set out to spend $20 million fixing up 81 of the homes. The money ran out after 37 were restored.

Portantino said it's time to sell the houses, especially given the state's budget woes. "We're talking about assets worth $400 million; we're in a budget crisis. Wouldn't it be nice to have that money?"

Document: Caltrans' bill for new roofs

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