Fire victims hoping to move into the Royal Oaks Mobile Manor just north of Phoenix this fall will have a longer wait after the state agency that purchased modular units for the development declared them unfit for habitation.

Oregon Housing and Community Services Department determined the homes are not suitable, healthy or safe to live in, said Delia Hernandez, a media representative with the agency.

“It is just devastating for us … to share this news with fire survivors, who have waited too long for a home,” said Hernandez. The agency is exploring all options with a goal of providing stable homes for fire survivors as quickly as it can, she said.

OHCS has partnered with the Housing Authority of Jackson County and ACCESS to develop and fill 118 homes on the site, which burned in the Sept 8. 2020, Almeda Fire. The agency contracted with Boise-based Nashua Homes of Idaho, Inc., to build 140 modular units after the Labor Day fires that swept through several communities in Oregon. 

Occupancy had been targeted to begin during September or October. Opening is now set for spring 2024 at the earliest. OHCS and ACCESS notified applicants of the delay.

The units had structural problems, but on the advice of agency lawyers Hernandez said she was unable to go into more detail about the issues that led to the decision. She was unable to confirm whether the agency would take legal action against the manufacturer.

State Rep. Pam Marsh, D-Ashland, told Oregon Public Broadcasting that the problem with the homes is that they were not built up to code.

“The flaws that we’re finding are not the result of sitting. They are flaws in the actual construction of the units,” she said.

She said mold has been discovered in some of the homes, as well as leaking water and multiple other code issues.

OHCS is working with the state’s Department of Justice on strategies to protect the state’s financial interests in relation to the resources used to fund construction of the units.

“Because we are doing housing navigation work, we partnered with OHCS and the Housing Authority to manage the initial application process and do the state qualification work,” said Joe Vollmar, ACCESS housing director.

ACCESS was in the process of screening applications from 44 former Royal Oaks residents who had applied for the units and were given preference. Another 150 fire victims from other locations applied for the program. By lottery, 100 of those had been chosen to be screened for eligibility.

“We were working with all 44 of the applicant residents to determine their eligibility to move in. We were still working through the qualification process with them,” said Vollmar.

The units could be available for little or no cost in many cases, said Vollmar. The agency will look at other fire-related aid that applicants have received to determine how much they might pay. The aid could include insurance payments, assistance from the Federal Emergency Management Agency or other help.

The application process will pause until the project gets closer to coming back online, said Vollmar, if the applicants are still interested. Meanwhile the agency is working with five survivors with options that include rental assistance, other housing projects and programs, or home ownership.

“Disappointment is too light of a word. We are heartbroken,” said Vollmar. “We want to navigate these people into safe and stable situations.”

The Housing Authority of Jackson County used $6 million of an award from OHCS to purchase the 21-acre property in early 2022. They estimated they would spend another $5 million or more to redevelop the site, including replacement of most of the infrastructure. A homeowner’s association will be formed, and HAJC will likely manage the site.

Sixty-six of the modular units are now on the site, HAJC Development Director Ryan Haynes said. Carports have been constructed on about 75% of the home sites. Foundations remain to be poured for eight of the units, while the community building is essentially finished. The streets are awaiting paving, and storm water and landscaping work remains.

“We will do everything on our end to pick up where we are at this point and make something good out of it,” said HAJC Executive Director Jason Elzy. The authority’s part of the project is on time and on budget, he said. About 75% of the development work is finished.

Attempts to secure comment from Nashua were unsuccessful.