Gainesville doesn't want a modular home in residential-1
zones, but this builder refuses to go down without a fight.
By RICK LAVENDER - The Times
Grant Smereczynsky has sued Gainesville
in federal court after the city ordered him to stop
construction of this modular house in Waters Edge subdivision
in March 2005. It has since given Smereczynsky 30 days
to remove the home, though legal wrangling continues.
Grant Smereczynsky refuses to go quietly.
Since March 2005, when Gainesville ordered the Building Systems
Network chief executive officer to remove a partially-finished modular house in Waters Edge subdivision, Smereczynsky
has sued in Hall County and federal court, rallied interest
from the modular
construction industry nationwide, and regularly pleaded
his case to area media.
"I've chosen to continue the fight," Smereczynsky
said last week. "... I'm in the deal to the end."
The deal has reached a new boiling point.
The city, feeding off a state Court of Appeals denial of
Building System's appeal, on Sept. 12 gave the Gainesville
company 30 days to remove the home on Waters Edge Drive. Smereczynsky
is seeking a court stay.
a builder and chief executive officer of Building Systems
Network, stands in front of his office Thursday morning.
An attorney representing the city's insurance company has
also filed to dismiss constitutional claims in Smereczynsky's
second lawsuit. The aim: Return the suit to Superior Court
where it started, said George Butler, Smereczynsky's lawyer.
Butler does not expect a ruling for months. City attorneys
could not be reached for comment.
Meanwhile, Smereczynsky is circulating recent letters of
support from building groups including Greater Atlanta Home
Builders Association and the National Association of Home
Some leaders said last week they know of no other federal
case involving the industry, a significance that is raising
"It's a case that certainly has some interest and poses
some concerns to us as an industry," said David Endy,
chairman of the national association's Building Systems Councils.
The question is where does this lead, or leave, Gainesville?
The dispute can be traced to January 2005. That's when the
city issued building permits to Building Systems Network for
two lots in Waters Edge, an upscale subdivision off McEver
Road behind Free Chapel Worship Center's former main complex.
Smereczynsky, 43, a former developer, had started Building
Systems a few years before. The Dawsonville Highway firm designs
and builds modular or industrialized homes and offers related services.
house in northern Hall County is similar to the one
his company and Gainesville are sparring about. Among
its features, the 6,900-square-foot home has a 25-foot-tall
stone fireplace, hickory floors and a three-car garage.
The move to build in Waters Edge proved a misstep.
City officials maintain the permits should not have been
approved and that Smereczynsky's agent provided inaccurate
or incomplete information on the applications. Smereczynsky
denies the charge.
Gainesville bars industrialized homes in residential-1 zones,
which cover Waters Edge and other single-family subdivisions.
Instead, houses that are mainly built off-site are limited
to agricultural-residential, residential-2 or multifamily
and residential-office districts.
Apparently alerted by neighbors, city officials stopped Smereczynsky
More than a year later, part of the story-and-a-half structure
is still stapled with Tyvek house wrap. The other lot has
only a cement foundation. That owner went bankrupt, Smereczynsky
Building Systems has weathered its own troubles. The company
lost in Superior Court and then on appeal to the state.
Superior Court Judge Kathlene Gosselin nixed the company's
key claims. City code is clear, Gosselin wrote, nor does it
conflict with state law regarding industrialized buildings
and local zoning.
One modular home official said Smereczynsky's former attorney
bungled the case. The builder came up shy in other areas,
City Council unanimously denied his request in May to rezone
the lot as residential-2, which would allow him to finish
and sell the "spec" home. Council saw it as spot
zoning. That decision led to the pending lawsuit.
The city bumped it to federal court in July because of the
constitutional claims. One is that Gainesville code illegally
favors local builders over houses manufactured out of state,
a violation of the Constitution's interstate commerce clause.
Neither side is budging. City Manager Bryan Shuler said this
week, "The solution is to remove the violation."
Industrialized or modular
housing takes its name from construction largely done
in factories and built in blocks, or modules. Related offshoots
include houses built in panels, precut structures such as
log homes and even mobile homes.
The trade harkens to the kit houses sold by Sears in the
early 1900s. But the business has grown far beyond bungalows.
Smereczynsky lives in North Hall in his company's newest
showcase, an $895,000, 6,900-square-foot mansion with a 25-foot-tall
stone fireplace, hickory floors and a three-car garage.
Second-floor railings and other trim pieces came from boards
in an 1800s barn moved to make way for the house.
Smereczynsky's house in northern Hall County was built
using the same modular technology that is at issue in
a legal battle between his company, Building Systems
Network, and the city of Gainesville.
Speed and affordability have long been selling points for
industrialized commercial buildings. Examples are as close
as the next Waffle House or bank branch. Yet, the business
is also blazing in-roads into housing.
One Internet commentary said modular structures account for
about 3 percent of new homes nationally each year.
A report tracking modular home shipments marked totals down in this year's second quarter
compared to 2005 but up in some states, including Georgia,
according to the National Modular Housing Council.
Georgia is one of a handful of states where state law puts
modular housing on par with its site-built cousins.
About 27 factories make industrial homes or products in the
state, said Rex Kennedy, a former plant owner and chair of
a state advisory committee on industrialized housing. Another
85 businesses are licensed to ship products into Georgia,
A stigma hampering wider acceptance is the thinking that
industrialized housing equals manufactured homes, or trailers.
Kennedy and others point out that manufactured homes are
built to 1974 federal Housing and Urban Development standards.
Industrialized or modular housing in Georgia are held to International
Building Code, the same as site-built or so-called stick-built
Advocates argue that industrialized houses can even be better,
customized and crafted with machine precision in controlled
conditions, inspected more thoroughly, put together quicker,
proven stronger in at least one federal report following Hurricane
Andrew, and rated greener in energy and waste savings.
Walls are often studded with 2-by-6 boards instead of two-by-fours,
offering more room for thicker roll insulation.
The modules arrive with everything from dry wall to wiring.
They are set in place like giant-sized Legos. Collapsible
parts such as roof sections are unfolded. Seams are bolted
and strapped. Finish crews add what's missing.
Smereczynsky's "Homestead" house in Squirrel Creek
Meadows off Ga. 60 arrived in five sections. Crews pieced
it together with a crane in two days. Finishing it inside
and out took less than 120.
The end to the standoff in Waters Edge may take longer.
Neighbors have opposed the home. They are concerned it will
erode property values and maintain that Smereczynsky should
have known the regulations.
Some homeowners have been reluctant to comment. The subdivision
association president could not be reached. Another homeowner
who declined comment on the record said Waters Edge houses
range from $300,000 to $1 million.
Smereczynsky said the four-bedroom, three-and-a-half-bath
house he hopes to finish will appraise at $339,000, a price-point
some critics question.
Smereczynsky alleges that outside influences are at work.
Taking his side, the editor of Colorado-based trade magazine
said City Council has shown "Taliban-like wisdom"
in limiting residents' personal choices.
Council members have remained mum about the lawsuits. Planning
director Kip Padgett said there is no internal move afoot
to change the zoning code and open the door to industrialized
homes in single-family subdivisions.
Hall County did in 2002. Commissioners amended county regulations
to allow modular housing in all residential zones. The change
followed a similar conflict involving Smereczynsky and a house
he was building in Gillsville.
His odds in the city seem longer, however.
Though his business is thriving, he said he has lost more
than $200,000 on the Waters Edge project. He hopes through
federal court to regain that and more.
He has the backing of the state Department of Community Affairs.
A March 2005 letter from department Commissioner Mike Beatty
mentions state law highlighting construction standards and
points to DCA rules that guard against discriminating against
housing built off-site.
Steven Snyder, executive director of Pennsylvania-based Modular
Building Systems Association, has proposed an amendment to
write that prohibition into law.
Smereczynsky said there is a sponsor for the legislation
in the 2007 General Assembly, though he did not know whom.
Snyder said he knows of no other federal court challenge
involving industrialized housing. "We're kind of breaking
new ground here," he said.
The prospect has helped Smereczynsky raise donations for
his legal fight, about $50,000 so far, he said. What impact
the outside interest will have is unclear, however.
Mike Gleaton of Community Affairs said the agency has no
enforcement power. And as a "helping hand" for local
government, the department is in an awkward position trying
to pressure city leaders, he acknowledged.
The state Attorney General's office has been asked to file
a brief in Smereczynsky's favor. It hasn't, so far.
Kennedy called the outcome "vitally crucial" to
the industry. He said he could recall only only two similar
cases in Georgia, both settled in the builder's favor.
"Is anybody going to fight these people?" Kennedy
asked. "Or are we going to just sit and play dumb because
of some special interests?"
Shuler declined detailed comment but said the Superior Court
ruling shows that Community Affairs' rules do not trump local
Smereczynsky walked a visitor through the Waters Edge house
last week. The house looms over a steep street corner lot
sprouting weeds and shored up by a concrete wall.
A leak inside meant tearing out pieces of drywall, work Smereczynsky
had to get the city's permission to do.
"She's kind of gotten worn a little bit," he said
of the house.
Built in three sections, yes, it could be disassembled easier
than a stick-built home, he said later.
But before conceding the fight over whether the Waters Edge
house stays or goes, Smereczynsky promised something else.
"I'm gonna be on top of the roof. In a perch. With a
"It's going to be Grant's last stand."
Contact: email@example.com, (770) 718-3411
Originally published Monday, October 2, 2006
House Showdown Court Case Draws National Attention
City Unfairly Prohibits Industrialized Housing
won't accept defeat in legal battle Company vows to continue fight to build modular home
Homes Builder Challenges Discrimination from City Officials
in Zoning Case
rejects rezoning for prefab home
housing battle heats up over a modular home
home earns another 'no' from Gainesville
takes appeal to next level