This includes the home’s owner, Leonard Powell, 77; Gerard Keena, a court-appointed receiver who holds legal responsibility for ensuring 1911 Harmon is building-code compliant and safe for habitation; city officials who are responsible for enforcing building code compliance; and various mortgage brokers, lenders and lawyers.
Just last week, Friends of Adeline launched a GoFundMe page to raise money for Powell to help him pay off the receivership costs on his house. Several City Council members, including Ben Bartlett and Cheryl Davila, sent it to their email lists.
Meanwhile, the receiver, Keena, says his primary goal is to get Powell back into his house. But he’s asked the judge to approve the sale of 1911 Harmon if Powell can’t find the money to pay off his debts. Keena pointed out that, each day that passes, Powell’s costs to get access to his house go up due to interest rates and fees.
But court documents, correspondence and interviews provide enough facts to get a sense of the situation, including what lies ahead. The next month or so will be key to the story, as the court, and pretty much everyone involved, want a quick resolution.
Powell, a veteran and retired U.S Postal worker, bought 1911 Harmon about 45 years ago, making a home for himself, his wife Myrtle Powell, and their six kids; five were hers from a previous marriage. Myrtle died around 20 years ago. Leonard now works part-time as a school crossing guard.
When Powell bought the house it was a legal duplex. One unit was on the ground floor, the second on the top. At some point, he converted the house into one residence for his large family, he said. He didn’t get city permits for this work.
Powell was a mail handler technician at the main Oakland Post Office until he retired. He met his wife at Merritt Community College, where she was training to be a lab tech. She had good job offers straight out of college, he said, but opted to stay home to care for the kids. “We had six babies for goodness sake. She needed to be home or close to home.”
A natural storyteller with a sense of humor, Powell clearly loved having a large family and loved sharing it all with his wife. When Myrtle needed a new kidney, her husband didn’t blink to donate one of his.
“It’s a typical Black American story,” Powell said. “She married too young too fast, too many babies. And then I came along. She was 24; I was 28. And she suddenly had number six. My parents thought I was out of my mind.”
Building code violations
About five years ago — and this is part of the story marked by differences of opinion — someone alerted the city to possible code violations at the house. One story is that Berkeley police notified the city after making a drug raid at the house. Another is that it was relatives renting from Powell.
City inspectors found several code violations and asked Powell to address them. The city took the steps required by law: letters to the property owner, notices on the house, deadlines to comply, the consequence of fines or liens.
According to court documents, Powell didn’t correct the violations. The city petitioned the court to appoint a receiver to bring the house into code compliance. This rare move is made by cities or counties when other means of fixing a property have hit dead ends.
Powell says this is incorrect and that he did have some work done on the house to avoid receivership. He said he took out a $100,000 loan — the maximum allowed — from Berkeley’s Senior and Disabled Home Rehabilitation Program. These are no-interest loans that don’t need to be paid back until the property is sold or the owner dies, whichever comes first.
But this was, apparently, not enough or not clear to the court. There are different views.
“I was pretty naive about the whole thing,” Powell said about the receivership. He did get an attorney, who turned out to be “an ambulance chaser,” Powell said. He got a new lawyer whom he likes much better.
“The Property is currently maintained in such a condition as to violate the Health Safety Code and Berkeley Municipal Code, thus creating a nuisance which sustainably endangers the health and safety of the public pursuant to Health Safety Code Section 17980.6
“Respondents have been provided with notices to repair and abate the nuisance conditions and have not done so within reasonable time.”
A court-appointed property receiver essentially is given legal authority over all matters relative to the property to bring it into compliance and meet safety and health codes. Receivers are required to update the court with progress reports and accounting. Keena is doing this. City attorneys attend the hearings, but decisions are up to Keena with approval from the court.
This includes securing loans, hiring contractors, managing construction and relocating residents if the house can’t be lived in. Such was the case with Powell and his family, who were relocated first to the YMCA, then to an extended-stay hotel and now to the basement of his son’s house, which he co-owns. Documents say eight family members were living on Harmon Street when the receiver took over.
The costs for all of this, plus interest, legal expenses, building permits and various fees for the receiver, are folded into the amount the property owner must pay to end the receivership and get access to the property.
Keena said he’s waiving his personal fees, which came to about $100,000, for the Harmon Street project if Powell secures funding to move back in. Keena is charging only for his staff’s time.
Receivers find loans or other funding to cover rehab costs. They also work with property owners to nail down a fiscal pathway for them to get their property back with a plan to maintain it and remain solvent.
If the property owner can’t pay to end the receivership, or if he or she decides to part with the property rather than get it fixed, the court can order the receiver to sell it. Proce go to the property owner, minus the expenses.
Skyrocketing rehab costs, waiting for a loan
Powell has always wanted to move back to Harmon Street, he said. His goal, he says, is to one day give the house to his disabled adult daughter who has kidney failure, and his granddaughter, who is her caregiver.
He recently said that living in one unit and renting the other would work for him and he thought he could afford it with the right financing in place.
But after Keena brought in engineers and architects, including Habitat for Humanity which was contracted to do much of the construction, the estimate to fix the issues at Harmon Street increased, first to $430,000 then, with more inspections, to $500,000 and finally to $600,000-$675,000.
This includes restoring the house to its legal configuration as a duplex, which is required by city and state regulations; asbestos and lead paint abatement; foundation and structural work; and various fees.
In a June 2018 progress report to the court, Keena outlined a possible way forward for Powell to repay the costs.
In addition to the $100,000 loan from the city, he thought Powell might be able to qualify for an additional loan of almost $600,000 based on his retirement income and future rent from one of the Harmon units. Keena suggested the city forgive some of the permit fees.
Powell has been approved for a $600,000 Veterans Administration loan, with two conditions — the completion of an appraisal, which is supposed to happen this week, and the repair of some termite damage found in a recent inspection, said George Tribble, Powell’s loan broker. Tribble didn’t know the nature or extent of the damage.
Powell’s son has agreed to pay for some of the gap, Tribble said, and thus far, the GoFundMe page (which, independently of this reporting, Powell supporters promoted with an ad on Berkeleyside) has raised around $23,000. “We’re trying to close it as quickly as possible. I’ll be more optimistic in a week,” Tribble said, explaining that every day the house is in receivership, Powell’s costs go up with interest and other fees.
Keena says the same thing: “It’s still a moving target; the [gap] number, it increases each day. It all depends on when it closes.”
Community, politicians react
Powell and many family and community members watching the issue are astonished at the ballooning cost of repairs for Harmon. Many are critical of the city for pursuing receivership rather than finding other ways to deal with the code issues. They’re suspicious of the receiver, saying they don’t understand why he pursued so many pricey updates.
They’ve shown up at Powell’s court hearings, posted on social media and written letters to politicians.
“The outcome we hope for is that Mr. Powell is allowed to move back to his house and that someone, somewhere along the way, takes responsibility for what happens,” said Wilkinson. “It was our understanding that what was supposed to happen to the house was the code violations were supposed to be abated.”
Keena, the receiver, said he can’t comment with much detail since the case is in the court system. But in a recent letter to Berkeley Mayor Jesse Arreguín, who in January asked the court to return the house to Powell, Keena explained the various reasons project costs jumped, the deeper structural work, asbestos and lead paint removal, and meeting the standards of funders, including the city.
He also said that, for Powell to qualify for federally subsidized financing [the VA loan], the house ne to meet guidelines set by the Federal Home Association, which go beyond the city’s code requirements.
“However, since Mr. Powell could not qualify for non-government financing, they were required if he was going to have any chance of returning to his home. The Court was notified of these increases in the cost of the project, they were approved,” Keena wrote Arreguín.
Keena points out in the letter to Arreguin that, in the event of a sale, the increased value of the renovated Harmon Street house, and the value of two other Oakland properties Powell owns, including the home he co-owns with his son where he’s staying, he should have “housing security.” According to Tribble, Powell recently transferred the title of one of the Oakland homes.
“We’re spending a lot of time and effort making sure we can land this plane on this really narrow runway,” Keena said by phone last week.
Meanwhile, Powell is “very worried and very distraught,” Tribble said last week.
The next court dates for the case are a conference call progress report with the judge, Jeffrey Brand, on March 8 and a hearing March 11 where the judge will consider whether the house should be sold.
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