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VACANCY, BLIGHT AND LOCAL GOVERNMENTS 10/26/2018 For more Information contact [email protected] 1 Vacancy, Blight and Local Governments PRESENTED BY MARCUS KELLUM, MM/PA, CCEA Negative spillover impacts of vacant and/or abandoned homes on neighboring property values In a study of Columbus, Ohio, Mikelbank (2008) found that vacant properties reduced the price of nearby homes by more than $4,000. In a similar study of Flint, Michigan, Griswold and Norris (2007) determined that each vacant structure within 500 feet a home reduced the home value by over 2 percent. In a study of Baltimore, Han (2014) also found that vacant homes had a negative effect on nearby property values. Vacant properties are also associated with higher crime rates.

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VACANCY, BLIGHT AND LOCAL GOVERNMENTS

10/26/2018

For more Information contact [email protected] 1

Vacancy, Blight and Local Governments

PR ES EN T E D B Y M AR C U S K ELL UM , M M/ PA , C C EA

Negative spillover impacts of vacant and/or abandoned homes on neighboring property values

In a study of Columbus, Ohio, Mikelbank (2008) found that vacant properties reduced the price of nearby homes by more than $4,000.

In a similar study of Flint, Michigan, Griswold and Norris (2007) determined that each vacant structure within 500 feet a home reduced the home value by over 2 percent.

In a study of Baltimore, Han (2014) also found that vacant homes had a negative effect on nearby property values. Vacant properties are also associated with higher crime rates.

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VACANCY, BLIGHT AND LOCAL GOVERNMENTS

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For more Information contact [email protected] 2

Negative spillover impacts (continued)

Cui (2010) analyzed crime and foreclosure data in Pittsburgh and found that violent crimes within 250 feet of a foreclosed home increased by more than 15 percent once the foreclosed home became vacant, with similar effects on property crime.

Branas, Rubin, and Guo (2012) found that vacant property is among the strongest predictors of assault among a dozen demographic and socioeconomic variables.

Realities of the Situation

These are examples of troubled property-property that is a definite financial burden to continue to hold but which also is unattractive property to some residents.

The timing now seems increasingly right for investors to obtain troubled property at bargain prices.

The pressure on owners and lenders with troubled property to get out from under the on going burden is also high.

The result is that syndicates have been formed to seek out and buy up troubled properties.

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VACANCY, BLIGHT AND LOCAL GOVERNMENTS

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For more Information contact [email protected] 3

The ProblemAs neighborhoods sink under the shadow of vacant and abandoned properties, regional leaders are trying tactics that have worked in other cities

Vacant property and the blight that usually follows have emerged as a crisis for cities and suburbs alike.

In Wichita, across the state and throughout the nation, the situation is denying local governments of desperately needed tax revenues, consuming millions of tax dollars, eroding the value of nearby homes, posing health and safety risks, and complicating already challenging neighborhood revitalization efforts.

Cause for concern Most municipalities confronted with high rates of vacancy and blight are struggling.

Recently, more government officials, community leaders and neighborhood organizations have seen the light in terms of understanding the severity of the crisis.

The amount of vacant property in some communities is impossible to ignore.

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VACANCY, BLIGHT AND LOCAL GOVERNMENTS

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The census counts vacant housing units, but not lots, and the data

include dwellings such as apartments in between tenants and vacation property not occupied at

the time of survey.

Not surprisingly, the trouble spots include poor urban neighborhoods,

older industrial areas that have experienced steady economic

decline, and more recently, places stung by high rates of mortgage

foreclosure.

In other words, the places shouldering the biggest burden of

vacant and abandoned property are usually the most economically

fragile and the least likely to have the resources at hand to do

something about it.

ImpactThe impact of vacant property extends beyond economic loss. Its role in unraveling the quality of life in a neighborhood and dimming the outlook of its residents is well documented.

Nothing signals neglect and disinvestment more than a street peppered with empty, overgrown lots and abandoned houses.

Not only do neighborhood residents get the message, but the larger community gets it as well. And once that happens, restoring community pride and engagement and convincing others to come in and invest becomes a much taller order.

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VACANCY, BLIGHT AND LOCAL GOVERNMENTS

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Protect the “Quality of Life”Difficult to define –means different things to different people

“your personal satisfaction (or dissatisfaction) with the cultural or intellectual conditions under which you live (as distinct from material comfort)”

Overall wellbeing/enjoyment of life

Broken Windows Theory

Broken WindowsFirst introduced by social scientists James Q. Wilson and George Kelling in 1982, it suggests that a broken window left unrepaired leads to others being broken and sends the signal that nobody cares.

Of course, it wasn’t only broken windows, but also abandoned cars, graffiti, blighted houses and other visible signs of neglect they were talking about.

In such environments, the theory goes, community controls break down, leaving a neighborhood wide open to crime.

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VACANCY, BLIGHT AND LOCAL GOVERNMENTS

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Negative Effects of Vacant Properties

First, vacant properties, especially those in poor condition, impose direct service costs on code enforcement units, police departments, fire departments, court systems, and other governmental agencies.

Second, vacant properties – especially poorly maintained ones – can impose negative “spillover” costs on nearby neighborhoods, including lower property values and higher crime rates.

Liabilities to Assets

The flip side of vacant and blighted properties is that under the right circumstances they can actually be used to advance the renewal of the neighborhoods to whose decline they contributed.

The opportunity for both public and private sector interest is growing in reclaiming vacant property to add elbow room and a little green to crowded urban neighborhoods.

With a lot of liabilities, your only option is to eliminate or reduce them. To be able to turn a liability into a asset is a unique opportunity.

Vacant property provides us with such an opportunity.

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VACANCY, BLIGHT AND LOCAL GOVERNMENTS

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What is Blight?(Merriam-Webster)

Something that frustrates plans or

___________

Something that ________or _______

A deteriorated

___________

What Is Urban Blight?

Urban blight is a complex term with multiple dimensions, from litter and vacant lots to dilapidated structures and abandoned homes

▪ Substandard housing refers to residential spaces with structural and other physical deficiencies that do not meet health and safety requirements, thereby endangering the health and safety of residents.

▪ Abandoned buildings refer to unoccupied homes and other properties that are in disrepair and pose a hazard to the health and well-being of the community.

▪ Vacant lots refer to neglected and empty parcels of land in a neighborhood that are used for dumping litter and other waste materials.

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VACANCY, BLIGHT AND LOCAL GOVERNMENTS

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Urban Decay, Urban Rot, Urban Blight

The process by which a previously functioning city, or part of a city, falls into disrepair and decrepitude

Urban decay has no single cause; it results from combinations of inter-related socio-economic conditions—including:

• the city's urban planning decisions

• the poverty of the local populace

• the construction of freeway roads and rail road lines that bypass—or run through—the area

• real estate neighborhood redlining

Manufacturing Cities & Towns

SteelAutoCoal

• A city does not die when its last resident moves away; death happens when municipalities lose the industries and vital populations that made them important cities

• The economy has evolved so much since the middle of the 20th Century that many cities that were among the largest and most vibrant in America have collapsed

• Some have lost more than half of their residents. Others have lost the businesses that made them important centers of finance, manufacturing, and commerce

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Hurricane KatrinaTen years after Katrina, many New Orleans residents struggle to find an affordable place to live even though the city is full of vacant properties.

Interventions to Mitigate Blight • Some interventions seek to prevent properties from becoming

substandard and abandoned, and others seek compliance with relevant regulatory codes and ordinances through various enforcement procedures.

• Local governments can eventually demolish buildings and homes that have been abandoned and pose imminent health and safety hazards.

• Existing research on blight interventions, however, suggests that some policies are working, but others are nascent with no tracked or reported outcomes.

• Much of the research on blight programs and policies tends to focus on economic results.

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“Public Nuisance” The usage of the term is meant to convey the idea that the municipality can take “action” due to whatever conditions are found during an inspection, therefore the language (definition of public nuisance) should be easily interpreted by enforcement personnel and subsequently by legal staff.

Government ResponsibilityThe responsibility for abating these public nuisances and then either rehabilitating or demolishing them rests with local governments.

Statutory procedures and administrative processes, however, present local government leaders with a host of management challenges.

When city and county staff first field citizen complaints about the hazards of vacant properties, they often respond by exercising their code enforcement authorities and abatement powers to clean up and secure the sites.

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Community NeedsWhen creating a new process or managing a program to address blight in a community, it is important to develop a clear understanding of the community’s priorities.

Once there is a clear set of requirements, it is important to rank them.

This ranking helps everyone (resident, elected officials, staff) understand the most important requirements, in what order to develop them, and what not to deliver if there is pressure on resources.

So what is the best method for creating a prioritized list of requirements?

Government ResponsibilityLocal governments also encounter internal coordination challenges. In the short term, the primary mission for local law enforcement and code departments is to abate the public nuisances and stabilize the sites.

In older urban communities, the demand for abatement of vacant properties significantly exceeds the capacity of staff and resources. Many places find it difficult to strategically integrate the abatement of vacant properties with other departments that administer rehabilitation resources, housing programs, and long-term land use planning.

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VACANCY, BLIGHT AND LOCAL GOVERNMENTS

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What’s the best action plan or management strategy to combat vacant property & blight? T H R E E L O C A L G O V E R N M E N T P R A C T I T I O N E R S O F F E R T H E I R E X P E R I E N C E S A N D A D V I C E .

JOSEPH SCHILLING IS DIRECTOR OF COMMUNITY AND ECONOMIC DEVELOPMENT, ICMA, WASHINGTON, D .C .

Five steps are needed at the local level before the problems can be effectively addressed.

The most immediate public safety need is a program to compel the securing of buildings that are open to trespass (by boarding if necessary).

The municipality needs to establish defensible standards for declaring properties a “public nuisance.” Vacancy alone is usually not a sufficient reason. However, criminal or drug activity, an extended period of boarding, and severe fire damage are examples that have been upheld in some jurisdictions as triggering the process.

Typically, the process must give the owner an opportunity to correct the situation and an avenue of appeal, when a determination has been made that the property is a public nuisance. Once this determination is made, the city can take steps to abate the nuisance. The most obvious method is demolition, but individual state laws can offer other options.

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VACANCY, BLIGHT AND LOCAL GOVERNMENTS

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Five steps are needed at the local level before the problems can be effectively addressed.

In theory, the cost of boarding properties and abating nuisances can be recovered from the owner, or at least assessed, then collected with the property tax. In reality, owners in distressed neighborhoods often disregard city bills, fail to pay property taxes, and effectively abandon the property, except to collect rent where they can.

Therefore, the municipality needs to dedicate sufficient funds to accomplish the goals, using state and federal grants when possible. Equally important, the city must work with the county officials, encouraging them to use the applicable state laws to foreclose on tax-delinquent properties.

Five steps are needed at the local level before the problems can be effectively addressed.

Programs are needed to provide below-market lending assistance for property owners seeking to renovate their buildings.

The last essential step is to assure that zoning and housing code standards are up-to-date and have a practical enforcement mechanism. If the local courts are swamped with business, the establishment of an administrative program that imposes a civil penalty should be sought.

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VACANCY, BLIGHT AND LOCAL GOVERNMENTS

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Summary

In any market, good or bad, there are always problem properties

Some may be neglected only because the present owner has failed to do fairly simple things

that can solve the problems.

Vacant properties—dilapidated housing, abandoned buildings,

and vacant lots—present communities with a complex

problem and a compelling opportunity for neighborhood

revitalization.

In some local governments, the problem may be an isolated house

or apartment building that deteriorates to the point where the property owner decides to

evict the tenants yet fails to board up the windows.

The responsibility for abating these public nuisances and then

either rehabilitating or demolishing them rests with local

governments.

When city and county staff first field citizen complaints about the hazards of vacant properties, they often respond by exercising their

code enforcement authorities and abatement powers to clean up

and secure the sites.

Marcus KellumMM/PA, CCEA

[email protected]

Trainer, guest speaker and consultant for professional organizations, municipalities and businesses

Facilitated sessions in over 18 states, and trained approximately 5000 officers from municipalities throughout the country

Former Director of Beautification and Code Enforcement Administrator for DeKalb County, Georgia

Former Assistant Director of Code Compliance for CH2MHILL which partnered with various cities throughout the country to provide

municipal services

Masters of Management and Public Administration, and a Bachelor of Science degree in Criminal Justice Administration.

Certified Code Enforcement Administrator, Property Maintenance and Housing Inspector, Soil and Erosion Inspector

Former Vice President of GACE, and Chairman of the Certification Committee

Member of ICMA, AACE, NFPBA and Phi Theta KappaRecognized in 2017 DiversityMBA magazine Top 100 under 50;

2006 Georgia Trend magazine Top 40 under 40 as “one of the best and brightest”; 2005 Who’s Who in Atlanta magazine as “one who provides a role model of

excellence”

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VACANCY, BLIGHT AND LOCAL GOVERNMENTS

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[email protected]

470.588.7144

Training Courses and Consulting Services for Businesses, Local Governments and Professional Organizations


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