New Orleans City Council, City Hall say Gordon Plaza residents will be relocated. But how?
After more than a year of constant pressure from a group of Gordon Plaza residents, the New Orleans City Council and the Cantrell administration say relocation from the toxic landfill site is closer than ever. But the crucial questions of when and how remain unanswered.
On Tuesday, a meeting between residents and some city officials began to clarify the next steps to relocate residents in the coming months as the city looks to redevelop the area into a solar park.
A key piece is figuring out how much it would cost to move residents and what would need to be covered if residents received what they call a “fully-funded relocation.” The City Council and Chief Administration Office will also look to secure a specific funding source within the next month for the $35 million budgeted back in January by the City Council, as well as hiring an outside firm to manage the relocation.
'Replacement cost is the only option'
Comprised of 67 houses, the Gordon Plaza subdivision was built on top of the former Agriculture Street Landfill in the 1980s. At the time, home buyers didn’t know the ground was laced with more than 152 hazardous chemicals, though they quickly realized something was wrong. That led to a federal investigation by the Environmental Protection Agency, which declared the area one of the country’s most toxic Superfund sites in 1994.
In turn, their home value has plummeted. An analysis by Tulane University’s Department of Sociology, School of Architecture and a local real estate broker found that the median sales price for a home in Gordon Plaza since 2000 has sat around $72,000. That’s far below the average price for a comparable house in New Orleans, which is $345,000, according to Ariana Tipper, a broker for French Quarter Realty.
That’s why, Tipper said Tuesday, “replacement cost is the only option here.”
At a local and federal level, appraisals have been found to be discriminatory, she continued. Replacement cost, on the other hand, is a property insurance term that evaluates an asset’s worth by comparing it to similar assets.
The analysis, released on Dec. 15, 2021, estimated the replacement cost for all 67 homes in Gordon Plaza could be about $440,235 each using a prominent software for estimating insurance claims.
Combined with the land value of each lot and moving costs, the total estimate equaled about $34,185,745 if every homeowner was bought out. City officials have indicated that not all residents want to relocate, though the majority of those that responded to a city survey do.
That report was generated at the request of the Tulane Environmental Law Center, which represented the Residents of Gordon Plaza, Inc. — the residents’ nonprofit — in two lawsuits.
Council members Helena Moreno and Eugene Green, who represents the district that holds Gordon Plaza, backed the use of replacement cost to calculate the city’s property acquisition. So did New Orleans Chief Administrative Officer Gilbert Montaño, though he noted that the city would need to conduct an analysis with a third party to verify the valuation presented.
“It’s just the reality that we have to operate in,” Montaño said.
'Our hands, in some ways, are tied'
To ensure the city is acting within its authority, Montaño and City attorney Donesia Turner said it had to hire outside counsel to offer legal advice and guide the relocation process. Turner said her office lacked the expertise to handle property appraisals, redevelopment and resident relocation.
“We can’t just give property away. So we need to just make sure everything is done legally,” she said of the Tulane report. “We don’t have that subject matter expertise currently in the law department.”
Currently, the city is looking to contract a firm, and its request for applications expires on May 26. The request asks law firms with experience in environmental or justice issues to respond with a bid. So far, the city hasn’t received a response — something that worries Green.
A lack of responses could push back the date that the issue is resolved, he said.
“Relocation is not something the city has done before,” Green said. “I’ve implored the residents to feel free to work with people with whom they have worked to get them to respond to the request.”
Residents questioned the need for another opinion when they already had experts do the work for the city. Montaño said the outside experts will allow the city to legally defend its choices and ensure it spends money appropriately.
“Our hands, in some ways, are tied, meaning we’re going to operate expeditiously but we also have to factor in the cautious role we have as administrators,” he said.
Where’s the money?
In recent meetings, Montaño has repeatedly stated that money won’t be an issue when it comes to relocating residents. Still, the city has yet to identify a specific funding source for the $35 million budget line passed by the Council in January.
Originally, the city hoped to leverage federal funds to acquire properties for its solar park after working with the Environmental Protection Agency on a feasibility study last year. The city needs at least 40 acres for the site, which will cost about $10 million, but it can be expanded to include more properties as they are acquired. That solar park would be used to power some Sewerage & Water Board pumps.
A city spokesperson said the Cantrell administration is still working to relocate residents and redevelop the site simultaneously, though Montaño said earlier this month that they decided not to wait on federal funding to begin the acquisitions.
In the coming weeks, the City Council will work with the chief administration office to determine whether unspent money from the 2020 bond sale could be that source, especially if that money’s original purpose has been stalled.
On Tuesday, Moreno said her plan was to secure a source ahead of the next meeting between residents, city officials and the Council come June 21.
“Within that time frame, there’s going to have to be some sort of Council action,” she said.
The Council is waiting on information from Montaño’s office to understand the status of the money from the recent bond sale. In a May 10 special meeting, Montaño noted that money from the next bond sale could also be used, though that’s not expected to go through until late 2023 at the earliest, according to a city spokesperson.