DETROIT - Marathon Petroleum Co.'s program to buy out homeowners in the Oakwood Heights neighborhood as the company expands operations has many residents who once vowed to stay put in their homes now wavering.

But a few remain determined to stand fast despite their neighbors' plans.

For five months, residents have watched as neighbors opted to sell to the oil refinery, feeling increased pressure to make a similar choice whether they want to or not. This month, Marathon officials said 86 percent of the owners have chosen to enroll in the buyout program - meaning they are willing to have their home appraised and see a monetary offer from the company.

Marathon is sweetening the pot, too, as it initially set a minimum appraisal price of $40,000 per home but already has bumped that figure up to $50,000.

The buyout plan is expected to head off lawsuits from those who live in this area. So far, the program has avoided legal entanglements, but it has generated plenty of hard feelings.

"They want to give us peanuts," said Linda Chernowas, one of the residents.

"But they're eating steak."

Marathon is in the midst of a $2.2 billion expansion of its refinery operation in this corner of southwest Detroit. And to create a buffer between its massive refinery and the surrounding neighborhood, the company instituted a buyout plan that targets an area that includes opposite sides of Oakwood Boulevard - roughly 500 properties and 300 homes. Once acquired, those homes will be torn down to create green space, according to the company's plan.

The refinery upgrade would allow the company to process heavy crude oils and increase its daily capacity from 106,000 barrels to 120,000 barrels. That expansion will bring the operation closer to portions of the neighborhood.

"At this early stage, offers have been made on approximately 30 percent of the residential properties in the first phase of the program and more than a dozen purchases have been completed," said Chris Fox, a Marathon communications manager, in a written response to questions.

A second phase of the appraisal process will begin on Nov. 2, and the company hopes to have the program completed by the end of next year.

"(Marathon) is committed to being a good neighbor to those who have indicated an interest in the program as well as those who wish to remain in the Oakwood Heights neighborhood," Fox said.

Preparing to leave

Linda Martin's home sits right behind the Diamond J Motel, within sight and smell of the Marathon refinery - the last such operation in Michigan. She's been here for 42 years and is preparing to leave. She and her husband will take the buyout offer and are looking for a place in Southgate or Trenton.

This wasn't what the couple wanted, but it is what it is, they said. In this market, they are unlikely to get anything close to what Marathon is offering for their home - a minimum of $50,000 plus extras that could reach $64,000.

"I'm having problems right now with my house," said Martin, 62.

"The pipes are really getting old. But at this point, why would I bother to replace them?"

Others have similarly changed their minds over the last five months.

Chernowas said she and her husband, Jim, hadn't planned on accepting the Marathon offer, but things have changed. Initially, they had no interest in selling the home they had paid off long ago and taking on a new mortgage to buy one somewhere else.

They know the neighborhood will soon be completely different. Newly vacant lots are being created by demolitions and each one makes the neighborhood less appealing to a potential buyer.

"I don't really care to leave," Linda Chernowas said. "But I know it's better if I do."

Owner at disadvantage

Chris Lee doesn't live in the neighborhood anymore, yet he's feeling the squeeze created by the buyout program. He said he moved to the neighborhood with his parents in 1984, and found everything there a child could hope for.

"When we first got here, it was like living in the suburbs," the 37-year-old recalled.

"In the springtime, we'd be at the park playing baseball. In the fall, it would be basketball."

In 2001, Lee purchased his own home a few blocks from where his parents still live. Then his wife scored big at a casino - winning $30,000 one night, he said. The couple opted to put it all back into the home. They refurbished it inside and out. After seven years there, the couple moved to Allen Park and began renting their Oakwood Heights home.

Lee is at a disadvantage, according to the terms of Marathon's buyout program. Since he does not live in the home, the minimum price he can receive for the house is $30,000.

With the house's original purchase price of $46,000 and the $30,000 in renovations, Lee said he can't bring himself to sell to Marathon at what would likely be a loss of more than $40,000.

And with each home that's knocked down in the area around his property, Lee's chances of finding a buyer seem more remote.

"I told (Marathon) you can knock down all of these houses," he said.

"I'll be the only one still standing."

You know you're in trouble when the Hostess man won't deliver to you anymore.

Truth is, Gary Korkes has had a sense of foreboding ever since Marathon announced its expansion plans in 2008. When the company announced the buyout program in the fall, things started deteriorating at Korkes' Oakwood Party Store at a much faster pace.

Korkes' business does so little in sales these days that his supplier of Hostess Twinkies, Suzy Qs and fruit pies won't come by anymore since it's not worth the trip. So every few days, the 57-year-old store owner drives to Warren, where he purchases the stock fresh, but a little closer to its expiration dates.

At the rear of his store are three large freezers that used to hold frozen foods, now empty from top to bottom. A plywood board up against the checkout windows is the only evidence of the ice cream freezer that used to be there. The pizza kitchen is gone, as is the takeout chicken operation. And Korkes no longer offers Western Union service.

All of these changes are the result of the decreasing store traffic, he said. Korkes draws almost exclusively from his surrounding neighborhood, and Marathon's buyout program is drastically shrinking that customer pool, he said.

From 1987 to 1996, the store sat roughly two blocks further south. But business was so good at the time, he expanded and opened the new operation near the Fort Street overpass.

His success story has done a complete reversal in the last four years, with more problems piling up in the last five months. For the first time in his business life, Korkes said he owes money he can't pay. Business is off by almost 75 percent, he added.

And Marathon has expressed no interest in buying him out.

"I'm just waiting for something that will help," he said.

"I need something to help me, or I'm going to close."

jlynch@detnews.com

(313) 222-2034

Copyright 2012 The Detroit News. All Rights Reserved.

(Originally published April 23, 2012, in The Detroit News.)