THE NEW GILDED AGE (Part 2)
THE NEW GILDED AGE (Part 2)
Part One: What are Some Answers to the City's Housing Distress?
07th December, 2006 0
A problem of criminal behavior.
That's how authorities describe a rash of more than 50 arsons in Saginaw, starting on the pre-Halloween Devil's Night.
County Treasurer Marv Hare agrees that criminal behavior is a problem, but he also adds another point. "If we didn't have all those abandoned structures, then we wouldn't have all those arsons," he asserts in simple summary.
In other words, arson is highly publicized. Local TV news especially likes footage of flames. But arson is only a symptom. The deeper true problem is abandoned housing. The cure is to save those properties that can be saved, while tearing down those beyond repair.
Consequently, we would not have so many arson targets.
City Development Director Odail Thorns, Jr. says more than 700 vacant houses dot the urban landscape, with 80 percent on the East Side and 20 percent on the West Side. He says abandoned garages and sheds push the slum number closer to 1,400 buildings.
Hare leads the year-old Saginaw County Land Bank Authority, a metropolitan effort to take local control of unpaid-tax eyesores that now usually languish with slumlords who obtain them at public auctions or through private transactions. A prime proactive task is to obtain and improve those parcels, or tear them down, before the speculators can get their hands on them. Government has first right of acquisition.
"I only wish we had a land bank 30 years ago," Hare says, "because then conditions would be a lot better today. Our purpose is to rebuild quality neighborhoods."
Other than the land bank, we have other blight flight highlights:
* Some leaders and citizens also want changes in housing codes. An 'appearance code' would hold an owner responsible not only for basic safe conditions, but for visuals such as painting or siding. At the same time, a 'smart code' would allow flexibility for an owner to make an isolated repair, such as a roof, without facing the whole nine yards of other requirements.
* City leaders will try to push more demolition costs on owners instead of taxpayers, but that's a tough one. It may seem basic to require owners to foot the bills, but it's difficult because of legal tricks in deeds and land contracts and so forth. Even if identified and found, owners may prove financially 'uncollectible'. In fact, some may be dead. Or, the taxpayer price of the collection process may exceed the demo costs that eventually would be recovered.
* Another City Hall goal is to generate revenue through expanded links with state and federal sources. The new connection with re-elected Gov. Jennifer Granholm is 'Cities of Promise', which addresses Saginaw's grit far more closely than her initial artsy and Ann Arbor 'Cool Cities' ventures. Some Cities of Promise funds would go directly for home demolitions and repairs.
* Of course, the city still has federal block grants, even while the sum annually is decreased with priority on the Iraq War.
* The Cathedral District surrounding St. Mary's of Michigan hospital is the city's new smaller target revitalization area, with the hospital as a major funding partner. This is a major change in the past approach of scattering resources across the city. Supporters say the smaller target area will finally produce 'visible results' in the Saint Mary's area, but what about the other neighborhoods? This will provide a separate topic for Part Two in our next edition.
Quick Response, Long-Term Need
Authorities did the right thing amid the arson spree when their first response was to emphasize law enforcement. Most of the torched eyesores may have been unoccupied and decrepit, but the fires were far from harmless. Neighbors were endangered. So were firefighters. And Fire Chief Joe Dziuban notes that when his crews are tied up at an abandoned nuisance, they are less able to respond to a truly life-threatening call from anywhere else across town. Saginaw had as many as four fires in progress at a single time after Devil's Night. That's intolerable. If we have information on any of our local firebugs, if we have seen or heard anything, we should call 1-800-44-ARSON, similar to dialing 1-800-422-JAIL for CrimeStoppers.
Firebugs should know they aren't just pranksters. They're criminals, as was shown with five recent arrest warrants, and penalties are up to 20 years in the slammer.
But now we must move to the deeper concerns that go beyond catching the arsonists. Arson isn't the only ill effect from abandoned houses. Drug dealers take over some of them. Children at play enter open doors. So do vagrants, with a few found frozen to death through the years.
Blight feeds on itself. One or two vacant structures on a block cause more families to also move and abandon. Then we have three or four. We've seen as many as eight on a single block. Property values plummet. Taxing units lose revenue. Potential investors choose to look elsewhere.
In summary, abandoned buildings give us a housing problem that goes beyond the highly publicized arson problem. A vacant house also creates a drug conduit, a child safety concern, a tax revenue barrier and an economic development albatross.
Where Did We Go Wrong?
Theories abound on causes for the urban abandonment that has led to the depressed state of many city neighborhoods, to the point where arsons are commonplace because vacant firetraps are aplenty.
Big-picture viewers will go way back to explain that Saginaw is no different than other suffering American cities. They will point to post-world war II federal housing aid for families to flee to suburbs, and for communities to build roadways. Saginaw is a victim just like Akron, Ohio or Gary, Indiana.
How about a little Crossfire? Some will say money for the War on Poverty flowed instead into the spigot of Vietnam (or today, Iraq). But others will blame the War on Poverty itself and a resulting loss of personal responsibility.
(Editor's Note: A prime example of this is the proliferation of 'group homes' for people on public assistance that are allowed to circumvent single-family zoning codes, which have been struck down by the Michigan Supreme Court on grounds of violating the Equal Protection clause of the Constitution. Historically, the group homes move into an economically viable neighborhood, milk them while they can, sell them off, and in the process, the value of the neighborhood becomes denigrated. Municipalities like Saginaw could challenge this decision via a class action with other municipalities on alienability of property grounds, but thus far have failed to do - instead allowing the strongest property tax generating neighborhoods within the community to become devalued through lack of action.
Locally, Saginaw after World War II allowed suburbs to buy water from the new Lake Huron pipeline. Midland in contrast forced its suburbs to annex into city boundaries. Big difference. Then we had home-loan discrimination known as 'redlining' and the whole East Side/West Side deal, the racial disturbances in 1967 following the Detroit riot, and Section 8 'Group Housing'.
More Crossfire, this time local? Conservative anti-taxers will point to adoption of the 1965 income levy for starting to drive breadwinners out of town. In contrast, liberal tax-and-spenders will cite the 1979 property tax freeze as a chokehold on city services. Too many taxes, or not enough?
Our summary of varying views regarding urban blight has barely scratched the surface. In fact, we have cut it short via the 'delete' button. Our purpose is to explore challenges and solutions. We can't find answers without understanding our past, but we can't dwell on the past, either. So we move ahead, citing background only as perspective for what's happening here and now.
Abandoned House Count
Saginaw inspectors in 2004 conducted a 'windshield survey' to compile a list of more than 500 abandoned homes. They resumed a more aggressive demolition program and have torn down about 200 since then. But now the new number from Odail Thorns is about 700 houses, along with the ancillary garages & sheds - over a remarkable and disturbing 100% increase in two years.
Are we missing something in the math? No. Thorns says his new study involving college interns going door-to-door is more complete than the old windshield survey. Plus, the rate of properties that become abandoned is outpacing the demolition program.
"We are looking at an $8 million dollar problem," says Thorns, projecting the price if City Hall somehow could clean up everything at once.
The need comes on top of millions already expended through the years, shown through thousands of vacant lots that already exist where houses once stood.
City Hall until 2001 used local budget money for abandoned home demolitions. A typical annual outlay started at $300,000 but rose to $500,000 because inspectors almost always went broke at the middle of the year and then asked for more. City leaders almost always managed to find the extra cash, despite their various laments of troubles during the 1980s and '90s.
The money pinch five years ago finally reached a point that wiped out the general funds' demolition line item. The choice in 2001 was that if City Hall paid for more demolitions, we would have to sacrifice another half dozen cops. Public safety took the money not only for home demolitions, but also for such services as youth recreation and mowing the parks.
Going Through The Hoops
City leaders in 2001 decided for the first time to use a share of federal block grants for demolitions. In the past they had relied on local money to tear down blight, preserving federal funds for rehab & renewal. But now they felt no choice but to switch demolitions into the block grants.
U.S. Housing & Urban Development regulators wanted to review the new use of funds. HUD put on the brakes for spending block grants to tear down houses, and took three years to give clearance.
Talk about bureaucracy! Jim Barcia, former U.S. Representative, called the HUD pencil pushers "ridiculous" once he was out of office and switched to State Senator. Aides to current office-holder Dale Kildee want to stay in HUD's good funding graces, so they remain tight-lipped. Detroit's regional HUD staff steers media questions to a larger office in Chicago that is largely unresponsive, which prevents us from telling both sides of the story.
Regardless, Saginaw's hands were tied from 2001 to 2004. Saginaw and the feds eventually found common ground, but these three idle years were when the stockpile of abandoned homes skyrocketed.
Past council and staff members started to bank block grant demolition money during the time spent struggling with HUD. This wise move amassed a combined $1,627 million during the past four years to tear down about 200 eyesores. Thorns is requesting another $578,000 for fiscal 2007-2008. Sadly this is cash that otherwise would have gone into renewal and rehab.
Money I stretched thinner than ever, in large part because of skyrocketing landfill fees. Those wood beams & shingles go into landfills, the same as our regular trash. Demolition prices vary wildly, based not only on a building's size, but also on factors such as asbestos and the type of siding. The average cost is about $8,000.
Arson makes disposal more expensive. Chief inspector Jim Hodges says residents who live near eyesores expect fast results for demolition, but challenges remain. Property owners have enjoyed numerous local appeal rights for years; now a demolition requires a state review of the home's historic value, and of course HUD demands reams of paperwork.
"People think we can do it right away, but it's a six month minimum and in many cases we're looking at a period of years," Hodges says.
Some onlookers, including a few City Council members, have suggested that the city could sell or donate vacant structures to families who would make repairs. Few properties are indeed saved through 'homesteading', but Hodges is among housing specialists who place a damper on the concept. He asserts that if properties in question indeed had potential, landlords would have snapped them up. Most vacant houses that remain are the worst of the worse.
"A lot of these properties would need $50,000 and then they would still only be worth $20,000."
Land Bank Gets Started
A few folks challenge Hodges' outlook every year. They mostly are from out of town, watching infomercials or reading books regarding how to make a fortune obtaining cheap tax-reverted land. In recent years, they have bought up inner-city vacant lots for $100 a piece at the state's annual unpaid-tax auctions. Sometimes they shell out $2,000 or $3,000 for what really are shells of vacant houses. No single slumlord exists, but plenty of speculators have come onto the scene.
Marv Hare has watched the tax rolls through the years. He sees how rarely anything actually happens with the properties. Most remain abandoned and wind up tax-revered once more, until someone else snatches them up.
"We have idiots in E-bay buying these properties site-unseen," Hare says in frustration. "We need to get more control.
This is where Saginaw County's new land bank comes into play. Hare chairs a 15-member board with a cross section of county and metro representatives. The model is the state's first land bank, in Genesee County, which has foreclosed on more than 3,000 vacant lots and more than 1,000 houses since March, 2002, while demolishing 400 vacant homes, selling a few for profit to continue operations.
Dan Kildee, Congressman Dale's nephew, is the Genesee County treasurer and the land bank leader. He says profits that formerly went to the infomercial watchers now go to the local government, creating a rollover fund for fighting blight.
Hare notes that Genesee's land bank has reaped millions of dollars from the Mott Foundation, and that Saginaw must start on a smaller scale with $100,000 from the Stoker Foundation through Citizens Bank.
Still, a land bank isn't intended to become a charity. Profits are supposed to start flowing once the concept gets on its feet. A model is the Michigan State Housing Development Authority (MSHDA) which operates without state general budget dollars.
Saginaw's land bank made its debut this year by acquiring 54 of the 318 properties that wee up for state auction. Most are in the Cathedral District, but some are in the city's West Side. Hare and his new board also picked off a few in the suburbs.
In a first example, the land bank will tear down a vacant house in the 800 block of North Granger about a mile from the courthouse, and sell the lot to an adjacent homeowner for half of the demolition cost.
"I wish we could have taken more than 54, but our funds are limited," Hare says.
"I'm trying to show the townships and everyone that this is a countywide project, but let's face it, 95 percent of the need is in the city and Buena Vista. When we can give side lots to neighbors, we will do it. For the properties we keep as inventory, we will maintain them as clean and green. We hope to get some church groups involved, and possibly use some of the county prisoners."
Codes for Housing Appearances
Jane Ann Zummer from the West Side's Heritage Square area is a community activist. She has helped lead a 6-year old effort to revive a neighborhood park at South Bond and Cass. Group members have raised $25,000 and landed $150,000 in grants, while giving thousands of hours of sweat equity.
With all that effort for the park, Zummer wants neighbors to maintain their properties. She's a tad more emphatic than other leaders. She says once she complained so hard to a slum landlord that he sued her for harassment.
She admits getting in the ears of Thorns and other city staffers, trumpeting a key theme: 'What good is a code if you don't enforce it?'
(Editor's Note: Perhaps Zummer and other citizens should ask City Council how effectively their $369,114 expenditure for environmental impact enforcement is being spent? Supposedly the City pays this amount to one full time inspector and several part-time people that handle complaints pertaining to code violations from neighbors allowing their yards and homes to fall into disrepair.
Don't forget the basics, Zummer says.
She says a house can meet the regular code, but it still detracts from the area if it looks lousy. She has researched appearance codes in other cities and says there's no reason for Saginaw not to have one, as long as a staff commitment is made for enforcement.
She also desires more emphasis on environmental codes.
"We need to get after those people with four cars in their yards and trash on their porches," she says. "If we do more about the little things, then maybe the big things won't become so bad."
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THE NEW GILDED AGE (Part 2)