5 FIXES FOR PHILLY’S CONSTRUCTION CHAOS

Fifty Philly rowhouses each year are rendered unsafe during construction next door. Here are five bold ideas on how to stop construction destruction without thwarting development.

Crumbling City is an Inquirer series about how Philadelphia’s surging housing redevelopment has led to construction safety issues in a city that has the nation’s most rowhouses and some of the oldest housing stock.

When Amy Freeman bought her home on Latona Street in South Philadelphia in 2019, she didn’t imagine that, less than five years later, it would be gone. That changed in April 2022. “I looked out my window,” she said, “and there was a hole in my yard 10 or 15 feet deep.”

It had been swallowed into the excavation pit that had replaced a beloved community garden, soon to be the site of 10 luxury homes. She put in a 311 complaint, called the city Department of Licenses & Inspections (L&I), and contacted her City Council member.

But, Freeman said, nothing she did made an impact. Instead excavation moved closer. By fall, a new crack zigzagged up her facade. Soon, her side wall was separating, and her foundation fractured.

She got an engineer’s report, which offered a grim prognosis: “Demolishing and rebuilding may be the best repair.”

Freeman’s home is among the 50 or so rowhouses in Philadelphia deemed unsafe or destroyed each year during construction next door, an Inquirer analysis has found.

City policymakers have adopted numerous new regulations in recognition of the challenges facing a city with the nation’s highest concentration of rowhouses, some of its oldest housing stock, and a continued appetite for infill development.

Yet, Freeman discovered that she was ultimately on her own. “It’s kind of disheartening, because there wasn’t an actual solution.”

Eventually, she hired a lawyer and got a settlement from the insurance provider for Campos Enterprises, a subcontractor of the luxury home builder, Piper Crown Construction. (Campos and Piper Crown did not return phone calls seeking comment.) A few weeks ago, she listed her home for sale for half of what she had paid for it.

But other neighbors are still dealing with the damage — including two homes adjoining Freeman’s that L&I also deemed unsafe last fall.

One belongs to Raymond and Marcella Garcia, who got a call from a neighbor while in Colorado for their daughter’s wedding, alerting them to the L&I notice. They cut their trip short, Raymond said, driving the 1,700 miles home with his wife “crying and thinking they might be tearing down her family home where she’s been since 1956.”

He said he’s since been told the damage to their rear wall is fixable — but expensive. Their insurance won’t cover it.

Freeman feels guilty about selling to a developer who will likely demolish her house, and could potentially further damage her neighbors’ homes. “I’m perpetuating the problem,” she said.

Experts say that bold new solutions are needed. Here are some contenders.

1. Create a party wall arbitration system

For former Philadelphia L&I Commissioner David Perri, the obvious answer is to borrow a solution from a city that has even more rowhouses than Philadelphia: London.

There, for well over a century, work impacting attached properties has been regulated under a comprehensive party wall law. The Party Wall Act, as it’s known, was most recently updated in 1996 and expanded to all of England and Wales.

It works like this: Any property owner proposing work affecting a shared wall — whether building above it, excavating below it, or extending it for a rear addition — must first give neighbors formal notice of the proposed work. If the neighbors oppose that plan, a party wall surveyor (or a group of surveyors, if each neighbor wants to select his or her own) will document existing building conditions, review engineers’ reports and building plans, and then draft an agreement known as a party wall award that is legally binding on all parties.

The award removes barriers to development by granting workers necessary access to neighboring properties, says Benjamin Mackie, who’s worked in and around London as a party wall surveyor for the past decade. But it also regulates how that work is done: His awards dictate everything from work hours to the placement of construction fencing to whether workers are permitted to use heavy machinery. A party wall award can also order the owner to pay for any damage that occurs.

“It stops [neighbors] being stubborn,” said Mackie, who does business as The Party Wall Collective. “It’s a balancing act: The neighbor has a level of protection, and the building owner can just get on with their work.”

That’s not to say that Brits don’t complain about the system, which has bred an entire industry of party wall surveyors that, according to Mackie, including some who pad their fees with unnecessary work. There’s no required qualification, licensing or disciplinary system.

Mackie estimates that the requirements of the act add, on average, £1,000 (about $1,250) to the price tag of a project. If neighbors agree to the work, there may be no cost. If multiple neighbors oppose it, the price tag is likely to rise.

Even so, Nick Isaac, a property litigator and King’s Counsel at the London law firm Tanfield Chambers, said the informal dispute resolution process greatly reduces the risk of having to involve lawyers at all.

“It does reduce damage because it forces the owner to do things properly … and very significantly reduces litigation resulting from damage,” he said.

Under the Party Wall Act, when construction damage occurs, the property owner undertaking the work is strictly liable, according to Edward Bailey, a retired judge who handled party wall appeals in Central London County Court. That means harmed neighbors don’t have to prove negligence, haggle with insurance, or litigate which contractor or subcontractor is to blame.

“The great advantage is there is a simple, straightforward statutory remedy,” he said.

2. Ban, discourage, or mitigate risky work

One way to mitigate the risk of damage is to focus on curbing the specific types of work most likely to cause harm.

A top cause of damage is excavation that goes deeper than old rowhouse foundations to make space for livable basements.

Perri has argued that such excavations ought to be prohibited outright in the building code. Because of how the rowhouses were constructed — with 9-inch-thick brick party walls sitting atop rubble foundations (that is, rough stone held together with little or no mortar) — such work is inherently just too risky, he said. From a developer’s perspective, though, zoning changes could eliminate the incentive to take on that dangerous and expensive excavation work.

A decade ago, Philadelphia remade its zoning and set a unified residential building height limit at 38 feet. That, to some homebuilders, has dictated a path to building the three-story homes with roof deck and full-height basement they say the market now demands.

“You don’t have any choice. The city limits the elevation, the height you can take your building up to,” said Vincent Viney, whose company V2 Properties has built hundreds of homes and had run-ins with neighbors over alleged construction damage. “So you have to dig down.”

A zoning exception that would allow developers next to existing homes to build five or six feet taller, to fit in another floor without digging down, would clear a path to building marketable homes while reducing risk to neighbors.

The other main driver of damage to rowhouses is the demolition of adjoining homes. L&I Commissioner Ralph DiPietro said that speaks to a need for policies that deter demolitions and encourage preservation of intact rowhouse blocks. Community organizers have called for a special demolition-review process before permits can be approved.

With or without that, the building code could also be updated to ensure developers are responsible for making neighbors whole.

Tim Lynch, the former chief enforcement engineer at New York City’s Department of Buildings, said there a contractor knocking down part of a shared-wall structure must structurally reinforce the newly exposed party wall, such as with star bolts, and secure the neighbor’s facade.

“These should be minimum standards,” he said, because rowhouses rely on one another for lateral support.

3. Help those harmed get compensation

While Philadelphia has not taken steps to curb excavations or demolitions, it has enhanced licensing requirements: General contractors need $500,000 in general liability insurance, while demolition and excavation contractors must now be insured up to $2 million. This year, the city also began requiring that, before starting work, builders must notify neighbors, survey the condition of adjacent properties, and create a monitoring plan.

City Councilmember Mark Squilla, who pushed for those initiatives, said he now thinks more needs to be done so that neighbors see the benefits of those protections. Neighbors putting in claims to a contractor’s insurance company over damage are often told they’re not covered, he said.

“We need to make everyone play by the same rules,” he said. “We have to do a better job of enforcement — and to hold people accountable you can’t leave it to the private homeowner to go to small claims court.”

One interim solution, legal assistance for homeowners, is finally a reality starting next year, in the form of $200,000 allocated by the city to a Rowhouse Protection pilot program run by Community Legal Services of Philadelphia. Michael Froehlich of CLS said the funding will enable the nonprofit to hire a lawyer to work full time on assisting homeowners and tenants imperiled by construction, and to create a fund for hiring engineers and other experts.

Froehlich is hopeful that many homeowners can gain a level of protection before construction even starts, since infill development generally requires access to adjacent lots. A lawyer will be able to help neighboring homeowners negotiate access agreements, which can include terms such as adding the neighbor to the builder’s insurance, paying a daily access fee, or making repairs to the neighbor’s property.

Squilla said that, ideally, neighbors would see the benefit of the legislation and increased insurance requirements without having to hire a lawyer.

He said the city needs to think creatively but practically about what type of insurance product would ensure all harmed neighbors can access assistance — not only next-door neighbors who can negotiate and enforce access agreements, but also people like the Garcias in South Philadelphia, a few doors down from construction. One option, he said, could be a custom insurance product developed with input from the city to ensure both developers and neighbors are protected.

4. Make licensing more rigorous and transparent

Many critics — and even some contractors themselves — say Pennsylvania’s system of licensing contractors is far too lax and opaque.

Squilla acknowledged the need for more skilled workers, too, particularly for risky work.

“I don’t think the goal is to say we want to make sure that if we knocked your house down we can cover it,” he said. “The goal is to have the best, experienced workers doing this work so the likelihood of that happening is nil.”

In Philadelphia, general contractors need little to get approved other than proof of insurance and a 30-hour job site safety training. The Pennsylvania Attorney General’s Home Improvement Contractor Registration program has even fewer requirements.

In contrast, states such as Massachusetts and Maryland require a prospective construction supervisor to provide proof of work experience, and to pass an exam meant to demonstrate knowledge of everything from foundations up to roofing. In Massachusetts, continuing education is also required.

Some other states, such as Oregon, also publish a contractor lookup tool that reveals a contractor’s history of complaints, disciplinary actions and suspensions going back a decade.

DiPietro said he supports increasing contractor qualifications. But in his view, a test could unfairly disadvantage small contractors.

Some community advocates say developers and house flippers should also have to register with the city and obtain licenses. That would give the city authority to take licensing action when property is damaged or workers endangered, and create transparency in an industry where some developers use dozens of LLCs.

In the Pennsylvania State House, Rep. Joseph Hohenstein has proposed a package of legislation that he believes will protect neighbors and homebuyers. Among them: a residential construction lemon law and a bill that would effectively expand Philadelphia’s adjacent homeowner notification requirements statewide. The legislation has been stuck in committee for nearly a year.

5. Step up enforcement — and offer more resources

In Philadelphia, code enforcement is largely complaint-driven — and the only tools inspectors have available are to issue violations or to temporarily shut down work until violations are resolved.

Enforcement comes down in part to making sure L&I is adequately staffed: This year, the number of building inspectors is at the lowest it’s been in more than a decade, city payroll records show. DiPietro said L&I has struggled to recruit candidates who can make more in the private sector and who, once hired, need up to 18 months to be fully trained. But he said he has stepped up recruiting efforts and opened its search to a more diverse candidate pool.

But even when L&I staff are on site and issue violations, that doesn’t always motivate developers to repair damage. For instance, anyone demolishing part of a rowhouse block is required to stucco any party walls left exposed as a result — but that doesn’t always happen.

Elizabeth Baldwin, the city’s chief code official, said that new L&I protocols have solved that: Now, inspectors won’t close out a demolition permit until all required work on a neighboring home is complete.

But when neighbors’ homes are structurally compromised, what they need is not more violation notices but resources to make repairs, said Robin Bartram, an assistant professor at University of Chicago and the author of Stacked Decks, a book on inequity in code enforcement.

She argues for a focus on connecting owners with resources.

Philly controller said she will audit L&I over construction safety after Inquirer investigation

“Seeing newspaper articles about a house collapsing ... people getting injured, people getting killed — we can’t wait for the next tragedy," Controller Christy Brady said of the Crumbling City series.

Currently, the city offers up to $18,000 in free repairs through Philadelphia Housing Development Corp.’s Basic Systems Repair Program; $50,000 in low-interest loans through its Restore Repair Renew Program; and a new forgivable repair loan program for small landlords.

But some homeowners said they spent months waiting to hear from PHDC about whether they qualified for repair grants, or learned that they didn’t qualify for any assistance program because of poor credit or because their homes were too severely damaged to repair. A spokesperson said PHDC’s backlogs have declined in recent years, but repairs can take three to nine months to begin. Delays can occur if applicants submit incomplete information or if a type of work is in particularly high demand. But if a homeowner notifies PHDC about L&I violations, the agency will expedite work.

Bartram says that L&I inspectors coordinating directly with repair programs could streamline that process. (DiPietro rejected the idea, as outside his staff’s regulatory purview.)

“We could reimagine a code-enforcement mechanism that wasn’t punitive, attached to more funds, utilizing the expertise of inspectors,” Bartram said. “We could imagine code enforcement based on getting the repair work done rather than just writing people up.”