There goes the neighborhood

On paper, Del Paso Nuevo is an unqualified triumph. The new community, a $21.5 million “homeownership zone” funded by the Sacramento Housing and Redevelopment Agency (SHRA), sits in the middle of Del Paso Heights, one of the most economically distressed areas in the county. Ragged streets, run-down lots and derelict shacks once riddled what is now the 150-acre Del Paso Nuevo neighborhood and its orderly row of homes, a children’s park and clean paved sidewalks. The development has been touted as a model, transforming blighted lots into opportunity for would-be homeowners of modest means.

Behind the Del Paso Nuevo success story, however, is a group of frustrated residents who say that their brand-new homes are already falling apart.

On a recent summer afternoon, Yuriel and Marciana Guevara gave a brief tour outside their two-story house. They pointed to the hairline fractures lining the exterior walls and the driveway, and noted how the wood beams on the fence are uneven and warped. Inside, said Marciana, nails protrude out of the carpet. When she flushes her toilet, the sound of water churning reverberates loudly throughout the house.

Marciana said she has often called Myers Homes, the local builder who built their house. Myers Homes occasionally has responded; according to Yuriel, it sent someone out to fix the fence but only compounded the problem by adding wood beams just as ragged as the original ones. More often, though, the standard response has been “Oh, that’s normal.”

“The people that came over, they made her feel bad, like she didn’t know what she was talking about. They tried to tell her that she’s dumb,” said Yuriel, who acknowledged that their English isn’t perfect. “We had a hard time making them come over here. They make everything look hard to you. They make you feel frustrated until you give up.”

Myers Homes acknowledged that Del Paso Nuevo’s Spanish-speaking and Hmong families have posed some communication problems. “Our warranty guy doesn’t speak Spanish. He doesn’t speak a foreign language,” said Jim Moltzen of Myers Homes. “But he has a very good reputation and deals well with people. The bottom line is when he walks out of that house, those issues [the homeowners] have submitted to us are taken care of.” He said the aforementioned cracks are “surface cracks” that are the result of “settling,” not “structural cracks.”

And so, an impasse is developing between many of the Del Paso Nuevo residents and Myers Homes. Moltzen said the company is proud of its work in Del Paso Nuevo—“We do build quality homes,” he added—and characterized the protests as coming from “a small group of dissatisfied owners.” But when a petition of complaint circulated throughout the community this summer, it was signed by 46 people, a solid majority of the area’s 54 homeowners.

Del Paso Nuevo first broke ground in 2000 after SHRA (which won a $10.5 million grant from the Department of Housing and Urban Development’s (HUD’s) Economic Development Initiative program in 1997) solicited bids from local developers. An estimated 300 homes will be built in six stages. The first two stages, 54 homes built by Myers Homes and another company, are done. A third stage of 23 homes is under way.

Many of the project’s key players have won awards for their work on Del Paso Nuevo. Myers Homes notched a certificate of appreciation from the Del Paso Heights Redevelopment Advisory Committee. SHRA earned a nomination for special recognition from HUD. Even Mayor Heather Fargo included Del Paso Nuevo among her “neighborhood accomplishments” during her successful mayoral run last year.

While city leaders are congratulating themselves, however, some families have already made plans to sell their properties.

Doris Hamilton is a single mother who lives next-door to the Guevara family.

For Hamilton, the trouble began soon after SHRA awarded her the opportunity to purchase a Del Paso Nuevo home (there was a waiting list and a lottery). She said the families were forced to use Wells Fargo bank as a lender. (Myers Homes claims this didn’t happen.) The one-year homeowner’s limited warranty allowed repairs for only the worst defects: The aforementioned cracks in the walls, for example, aren’t under warranty unless they’re greater than one-eighth of an inch. Hamilton said her house meets the criteria.

Hamilton bought her house in the spring of 2002. She says now that she didn’t know how extensive the problems were with the house or that Myers Homes would prove unresponsive to her grievances. The problems with Hamilton’s home are similar to those that the Guevaras, and other families in the Del Paso Nuevo neighborhood, face—from a dearth of energy-efficient windows to broken tiles on the roof.

And residents say their backyards are prone to flooding and that the resultant pools of sitting water attract flies and mosquitoes. “It smells bad,” said Marciana Guevara.

Clint Myers, president of Myers Homes, acknowledged that his company has responded to hundreds of complaints from the Del Paso Nuevo residents about their homes. “This community is a little more active in the warranty than some of our other communities,” he admitted. But, far from being unresponsive to their concerns, he said, “we have followed up with them, left letters, phone calls, everything else.

“I think if you look back, even though our warranty is a one-year limited warranty, we’re still out there doing repairs when people call, three years after the homes have been built. Not because we have to, but because it’s part of our customer service,” he added.

But Hamilton countered, “The problem is they come in and they do patchwork, and the problem is not solved. They do a patchwork job that is not up to standards.” For example, in 2003, a little more than a year after she moved into her house, she remembers asking Myers Homes to repair the foundation because the cement had begun to crack. “They threw some cheap cement up there [that was a different color], and that stuff is cracking,” she said.

On July 25, five Del Paso Nuevo representatives, including Hamilton, met with SHRA and the builders’ representative to try to settle the dispute. At the meeting, the ad-hoc committee presented its petition of complaint, which alleged that SHRA, the city of Sacramento, the Del Paso Heights Redevelopment Advisory Committee and the builders “breached” their contract by selling them homes with construction defects.

Both sides agreed that the residents would find a third-party housing inspector to appraise a sampling of homes. The inspector’s findings will determine whether further improvements will be made. “The idea is to have an objective third party take a look at these areas, make a report. If action needs to be taken, [the builders] will not have a problem dealing with those issues,” said Janet Rice, SHRA’s executive project manager for Del Paso Nuevo.

Myers said his company plans to abide by any decision SHRA reaches. “Right now, we’re waiting on the homeowners. It’s in their ballpark now. But we’re more than willing to cooperate,” he said.

Hamilton said the group tentatively agreed to this plan and hopes to submit a list of inspectors by the end of the month. But she fears that SHRA will use the inspections as a “rubber stamp” to dismiss their complaints.

“We want the American dream they promised us,” she added. “We don’t want them to overlook us just because we live in Del Paso Heights.”