Erie County Legislator Bob Reynolds held a Distressed Properties Task Force meeting in Erie County Hall today with the goal of forming sub-committees to address 23 separate root problems that were identified in a previous meeting. Recently established by Legislature Chair Lynn Marinelli and co-chaired by County Legislator Bob Reynolds and Hub Frawley, Mayor of Angola, the committee is made up of legislators, realtors, and key people representing local, regional and state government agencies, the group was successful in creating four specific subcommittees to address distressed properties, each if which will concentrate on the following issues:
Joseph Maciejewski, Erie County Commissioner of Real Property Tax Services stated, “Presently, there are close to 15,000 county properties in question, 284 of which have been identified as having tax liens greater than the assessed property value, with 161 of those being in the City of Buffalo. But as we continue to assess these properties, there may be another two hundred, and then another,”
Reynolds responded, “We need to get realtors involved as well as assessors. We need to find a way to stop the back tax lies so that they don’t exceed the worth of the house itself. We need these houses to be marketable.”
The nationwide collapse of the sub prime lending market may play into abandoned and distressed properties locally, but as one attendee to the meeting asked, “Are we trying to grow the region back to what it was in the 60’s, or are we looking to be smaller and better? Do we have the people to go into these houses?” It was agreed that right-sizing the city and the region was best, and that concentrating neighborhoods in areas where a good infrastructure already exists makes the most sense. Reynolds added that it would be good to have banks and developers join the task force to address the development of housing in existing structures rather than creating new-builds.
Commissioner Martin Kennedy, Department of Assessment and Taxation was most immediately concerned with the process of foreclosing on houses due to non-payment of back taxes. “We send out letters far in advance. We actively let people know. We’ve instituted a payment program and set up escrow accounts. Three days prior to the foreclosure auction, we take [the homeowners] to set up a court-ordered payment plan and take them off of the foreclosure list,” Kennedy stated.
Cities, towns, villages and county do not want the burden of properties that accrue taxes or need attention to code violations. “Our mandate is not to take someone’s property out from underneath them,” Kennedy said.
Reynolds added, “If we look at foreclosure process, during that time, the County of Erie pays the uncollected taxes to the town, village and school districts and when the taxes accumulate—sometimes up to 15 years—the buyer can’t afford to pay the back taxes. The Bethlehem Steel property currently is an example where the County possibly could owe $2.1 Million in back taxes.”
Anthony Armstrong of Local Initiatives Support Corporation (LISC) cited the work done in Genesee County in Michigan, whereby the handling of abandoned and distressed housing is handled on a countywide basis rather than by town. He suggested that the chairman of the Genesee County Land Bank be asked here to address the group. “If we think on a county-wide basis, the gains may exceed the losses,” Armstrong said.
Legislator Maria Whyte added that rather than cherry picking properties a better approach is to look at the abandoned properties as a whole. “We’ll get some with potential along with [distressed properties], but the aggregate would allow for some gains with less loss,” according to Whyte.
It was brought up that Senator Schumer’s and Congressman Higgins’ offices are looking for Federal dollars and is hoping to put this issue on the national agenda through a bill in both houses of congress. Bonnie Lockwood of Representative Brian Higgins’ office said that in light of the foreclosure crisis across the country, and the fact that preservationists often see urban renewal as urban removal, Higgins formed the Older Cities Revitalization Act. “There’s a need for demolition and rehabilitation dollars,” Lockwood said. “This is about preserving whole areas.”
When asked how many of the Buffalo homes in foreclosure are hardship cases, Kennedy responded, “Without looking at actual numbers, I would have to say most. And we don’t want to come in as big, bad government, taking people out of their homes.”
Later today, a press advisory was issued by Reynolds’ office saying that two bills have been proposed to Albany to address the issue.
“The first bill for which the Task Force urged immediate passage is A.8059-B /S.5366-B, an act to amend the general municipal law and the New York State urban development corporation act to create land banks,” began Reynolds. “These lands banks would enable the acquisition, management, planning and reuse of vacant and abandoned property.”
The second measure the Task Force seeks passage of is A.8345-C/S.6677-B, which would help Erie County recoup the expenses that accrue from the collection of tax delinquencies. This legislation would require that the amount to be paid − for the redemption of real property affected by any Erie County tax sale certificate in foreclosure − include the back taxes owed plus the accrued interest, penalties and the costs of the foreclosure itself, including necessary attorneys’ fees, court costs and abstracts of title.