It turns out that if you badger insurance companies and owners enough, they will pay for the demolition of their burned-out buildings.
Using that strategy, the city has so far managed to get other people to pay for demolitions under the new policy to demolish burned-out houses as soon as the fire is extinguished.
“We’re going after people,” Mayor Gary McCarthy said. “Right now, we’re pretty close to breaking even.”
In some cases, city officials have negotiated directly with insurance companies for the demolitions. In other cases, economic development agencies are covering the cost.
McCarthy tracks each demolition, particularly for buildings that turn out not to have insurance. The city has to make a decision to demolish before knowing the status of the building’s insurance and must pay for the work without any assurance that someone else will reimburse the city for the cost.
The most recent uninsured building, at 942 State St., cost the city $19,000 to demolish.
“It looks like there’s no insurance there,” McCarthy said. “I think I’m going to ask the city IDA to pay that, because there’s interest in that site.”
The Industrial Development Agency could also take the site, creating a clean title so it could be sold to a developer, he said.
McCarthy wants the City Council to make the process easier by passing a law to make the city a payee in insurance claims. That way, he said, owners couldn’t simply take their money and run, leaving the city holding the bill.
Right now, the city must be paid by property owners after the insurance company pays them.
The demolition policy has worked well in cases where the building was unoccupied. But in two cases this year, owner-occupied houses burned and the owners asked the city not to demolish their homes.
The first, on Schenectady Street, left a house badly damaged but not unsafe. The city had no grounds for demolition.
“Other fires may look bad, but structurally they’re not an immediate health and safety issue,” McCarthy said.
Fire Chief Michael Della Rocco said the Schenectady Street house burned before the city created its new demolition policy, but it wouldn’t have warranted demolition.
“It was owner-occupied, and the owners were going to try to do the rehab themselves,” he said.
Now the building sits vacant, and neighbors are complaining.
The second house, on Bradley Boulevard, was “right on the line” of being structurally unsound, McCarthy said. City officials reluctantly agreed to let the owners fix it.
“The owners wanted to rehab it, so we’ll just have to keep an eye on it,” he said, noting that sometimes goes badly.
“People will take the [insurance] money and then not make the repairs,” he said.
The city is also requiring landlords to list the city on their insurance so it is automatically notified if there is a lapse in insurance. Landlords must add the city to their insurance in exchange for getting a rental certificate, although most landlords currently flout that law and rent without certificates.