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Jermain Paines was angry and demoralized. The Detroit resident showed up in person to two meetings of the Board of Water Commissioners over the last month to detail his experience purchasing a house in northwest Detroit from the Detroit Land Bank Authority (DLBA).
“I thought I bought a dream house. I thought I bought a house that I can put my family into,” he said.
Soon after the purchase, however, he discovered that it had no water hookup or stop box, which contains an essential valve to connect a house’s service line to the water main.
Paines was upset because the Detroit Water and Sewerage Department (DWSD), which is overseen by the Board of Water Commissioners (BOWC), had told him it would cost $20,000 to $30,000 to get water to the house because the old water service line would have to be dug up to install a new one. Paines said he’s already invested $18,000 into the home on other repairs.
He told the Commissioners that neither the Land Bank nor DWSD offered him any help.
“[The Land Bank] told me that it was a DWSD situation and that I needed to contact DWSD to try to figure it out,” he said. “I have tried to work with DWSD to get the water on at this property but have failed at that level because DWSD said it’s a Land Bank home.”
Paines was one of several homeowners who showed up to voice their complaints at meetings of the BOWC over the last several weeks. They all purchased homes from the Land Bank that lacked connections to either drinking water or sewer lines, and they couldn’t afford to get them hooked back up. For Detroiters who planned to live in their recently purchased Land Bank home, it was a devastating discovery.
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The Land Bank and DWSD ultimately agreed to pay for service line replacement for purchasers who were told their home was connected to the water system when it actually wasn’t.
But the episode highlighted the challenges of identifying whether or not Land Bank homes have water connections. DWSD simply doesn’t know if certain homes have working water lines, and the Land Bank says it’s too expensive to find out.
“Unfortunately there is not anything the DLBA can do,” Land Bank spokesperson Alyssa Strickland told Outlier by email. “In many cases, absent reliable data, we’d have to dig up the yard to check the line, which is time- and cost-prohibitive.”
There is little the homebuyer can do either, except be ready to pay thousands of dollars. DWSD cuts water service to unoccupied homes, and the agencies don’t coordinate to document those shut-offs or if any equipment, like a stop box, has been removed.
Moreover, DWSD does not have complete and accurate information about water line status for every property in Detroit.
DWSD and the Land Bank shared data in 2020 after homeowners came forward to complain about water connection issues. The findings showed that when a home was added to the city’s dangerous buildings list and slated for demolition — as thousands were after a foreclosure crisis struck Detroit in the 2010s — the water line was often severed or removed. But this information wasn’t well tracked, according to DWSD spokesperson Bryan Peckinpaugh.
The Land Bank at times determined these homes were suitable for rehab and added them to its inventory but did not confirm whether the water line was intact.
Another source of confusion is the fact that all the city’s water permit data — which indicated whether work was done on a property’s water connection — was contained on index cards up until 2018 and not consistently updated.
“We are continually updating service line data electronically as we get updates from field and customer verifications,” Peckinpaugh wrote to Outlier by email.
This missing information has led to mistakes.
The Land Bank used to include information about water connections provided to them by DWSD, but Strickland said it wasn’t always accurate.
The agencies began addressing the problem in June 2020 for about a month and a half but realized they still couldn’t provide accurate information.
At a meeting before the BOWC this month, Land Bank Interim Executive Director Tammy Daniels said that of the 650 homes the Land Bank sold during that time of evaluation, 34 had inaccurate water service info. Strickland said their analysis suggests 56 people received inaccurate info prior to June 2020.
To make up for the mistake, the BOWC included the cost of replacing or reconnecting that service in a $2.7 million contract for lead service line replacement covering the pre-June 2020 group. The Land Bank will cover those who received inaccurate information during the 2020 period between June 1 and July 15.
“We’ve come up with a way to fix the problem and, hopefully, move forward,” DWSD Director Gary Brown said at the meeting.
The Land Bank sells most of its homes in “as-is” condition, meaning the buyer is on the hook for any issues with the property, seen or unseen. Land Bank homes do come with a property condition report that details the results of an inspection but doesn’t include information about a water connection.
Instead, potential buyers see a disclaimer for every listing on their website, which states that the Land Bank either has no knowledge of the condition of the water service line or that it’s been cut.
“The purchaser will be solely responsible for these repairs, including external and internal plumbing, which can exceed $10,000 or more,” the disclaimer states.
Only private sellers are required to provide disclosures about their property under Michigan law. Government entities, including the Land Bank, are exempt from Michigan seller disclosures.
Paines, the homeowner in northwest Detroit, said at the BOWC meeting he was unaware there wasn’t a water connection to his home when he won it at auction in June 2020 — within the time frame to get the service line replaced free of charge. But according to Strickland, when Paines approached the Land Bank about a potential water service issue, the Land Bank offered to refund his deposit. (He hadn’t yet closed on the house.)
“He declined, opted to close, and signed a separate document attesting to the fact that we could not verify the status of the water line,” Strickland said.
This issue also prevents Paines — and all other buyers unable to reconnect their water service — from owning the house free and clear. Land Bank compliance requires buyers to have running water before a lien is removed on their home.
The only way a potential homebuyer can know for sure if a Land Bank home has a water connection is by televising the line, a service that costs about $650, according to one Detroit plumber who requested anonymity. They said their company typically charges $6,000 to $12,000 to replace a service line, and a similar amount to replace a sewer line.
Several water board commissioners expressed their support for the homeowners and dissatisfaction with the Land Bank. Commissioner Linda Forte said the Land Bank is “just causing heartache” because they sell houses knowing they are unlivable. Commissioner Jonathan Kinloch said the Land Bank needs to stop selling “as-is” homes. At a minimum, the board suggested the Land Bank should give better information about whether there is a stop box or sewer connection.
Strickland at the Land Bank said it’s actually DWSD’s responsibility.
“Only DWSD makes decisions about what lines to cut, only DWSD can provide data about where service lines are intact or cut, and the price for reconnection or replacement is set by DWSD,” she said.
Reach AARON MONDRY at aaron@outliermedia.org or 313-403-7221. Reach NOAH KINCADE at noah@outliermedia.org or 415-336-8758. This article appears in today’s issue of The Dig, Outlier Media’s weekly newsletter on housing and real estate. Click here to sign up to receive it.