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Strategies & Technical Tools
Within these broader initiatives and model programs, local governments and CDCS employ a variety of legal tools to turn vacant properties into assets. While the specific tools chosen depend on the unique circumstance of the jurisdiction, any revitalization initiative will include the same types of strategies – prevention, abatement, acquisition, and reuse. Prevention strategies might include rehabilitation programs, foreclosure prevention programs, and comprehensive information systems. A variety of code enforcement programs and regulatory tools may be used to abate problems – one city may adopt a vacant property registration ordinance while another targets slumlords for special prosecution. One county may develop a land bank to facilitate acquisition while another chooses a community land trust model. The legal authority for these different tools varies among the states.
We have learned of many more models since posting this information - please check back soon!
Vacant Property Registration Ordinances
Regulatory strategies can be effective prevention approaches that reinforce good business practices and require minimal staff. Registration ordinances require owners of properties that have become vacant or abandoned for a certain length of time to register formally with the local government. They provide a point of contact in case the property becomes a public nuisance, and may encourage the owner to devise a timely rehabilitation plan by imposing fees to help cover the estimated costs for city departments to monitor, inspect, and re-inspect the property routinely. Registration ordinances can play an important role in a comprehensive vacant property strategy but work best where there is accurate information and effective code enforcement capacity. As a response to the foreclosure crises, many cities struggling with new inventories of vacant homes are creating ordinances as a way to help mitigate the damage to communities and recover costs incurred.
Model Practice
- Chula Vista, California’s ordinance, enacted in 2007, requires a local company to inspect the property weekly. The name and 24-hour contact information of the responsible party must be posted on the building.
- Wilmington, Delaware enacted a vacant property registration ordinance with a sliding annual fee scale – the longer the property remains vacant, the greater the fee. The ordinance allows up to a maximum of $5,000 if the property has been vacant 10 years or more.
- Cincinnati’s ordinance requires evidence of general liability insurance for the property with a minimum of $300,000 for residential properties and $1,000,000 for commercial or industrial.
Find out more (84 kb PDF). Municipalities are enacting new ordinances often; Safeguard Properties provides an excellent online resource to keep up to date.
Rental and Point of Sale Inspection Ordinances
Another set of ordinances – rental-housing inspection ordinances – regulates the business of rental properties. A number of cities throughout the country have ordinances that require an inspection at the time of sale or change of occupancy of the rental unit. If regular and routine inspections of rental properties are required, the owner and property manager are more likely to maintain the property in better condition. Several Ohio communities with routine inspection programs, such as Kettering and Trotwood, credit these ordinances with helping them prevent substandard rental housing.
Rehabilitation Programs for Owner-Occupied Housing
Many communities have traditional housing stock built in the first half of the 20th Century that is an asset worth preserving. A concerted rehabilitation initiative can direct resources to the homes and neighborhoods with the greatest reinvestment potential. Beyond providing homeowners with rehabilitation resources, successful housing-preservation programs often need special zoning and building rules as well as design guidelines and technical assistance. Small homes (less than 1,000 sq. ft.) seem obsolete for most of today’s housing market; they are often more difficult to market and rent, and thus are more likely to become vacant. Moreover, they were not built to last for fifty years, and many are in desperate need of repair or even demolition. Yet many of them provide moderate- to low-income residents with a good source of affordable housing.
Model Practice
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Historic Chicago Bungalow Initiative: In 2000, the city of Chicago launched the Historic Chicago Bungalow Initiative, a comprehensive program designed to support the preservation and upgrading of one-and-a-half-story detached brick structures concentrated in an inner-ring area known as the “bungalow belt,” adjacent to the city’s downtown area. To promote these bungalow neighborhoods, the initiative includes a certification process and design guidelines for rehabilitation, as well as access to technical assistance and financing for bungalow-renovation projects. More information about the initiative can be found at http://www.chicagobungalow.org/index.html.
Home Repair Programs
Home-repair loan programs are part of another housing preservation strategy that addresses the special needs of owners of single-family homes, especially senior citizens on fixed incomes or in difficult financial circumstances. In many communities throughout the country aging homeowners, or homeowners on fixed incomes, struggle to maintain their properties consistent with applicable housing codes. Unfortunately, the demand for such local assistance programs far exceeds available resources. With huge budget cuts in CDBG funds looming in Congress, policy makers will need to explore alternative sources of funding.
Model Practice
- The Cleveland Fix-Up Fund is a home-repair loan program administered by a community development intermediary, Neighborhood Progress, Inc., in partnership with two banks, the Cleveland Housing Network, and several CDCs. This neighborhood-based nonprofit program offers low-interest loans, technical support, and free guidance to help owners improve their homes. The fund’s Web site offers a Home Improvement Tracking System that allows a user to monitor a loan’s status and payments for the loan status and payments, as well as home repairs completed. Read more about the Fix-Up Fund.
Homeownership and Landlord Training Programs
Homeowners need to be well prepared for the responsibility that comes with this great asset. Rental property owners also need to understand what it means to be a good landlord, and understand how to maintain their property. Nonprofits, lending institutions, and government programs can all develop revitalization programs that not only facilitate access to resources needed to make repairs, but also help landlords, property managers, and owners acquire the basic skills of homeownership and property management. Foreclosure Prevention
Housing doesn’t always become vacant due to neglectful owners – it can sometimes stem from the inability to pay property taxes or make mortgage payments. Foreclosure prevention strategies should address the needs of families at risk of losing their homes. This might include a tax-foreclosure prevention program to help elderly homeowners, a substantial homeownership education program prior to a home purchase, and legislation to attack predatory lending and flipping activity.
Model Practice
- Miami Valley Fair Housing Center: MVFHC has a four-pronged approach: (1) education; (2) advocacy, (3) victim intervention through the courts, and (4) local data collection. Through the Predatory Lending Solutions (PLS) program, MVFHC specializes on the underlying complexities of fraudulent real estate transactions. Predatory lending has the most direct impact on struggling homeowners. By intervening in civil court on behalf of victims of these predatory-lending schemes, MVFHC has been able to obtain results, sometimes recovering as much as $80,000 for the victims. Importantly, the victims have also been able to convert high-interest loans to fixed-rate, thirty-year loans. Read more about the MVFHC.
Information Systems
A successful strategy to turn vacant and abandoned properties into community assets depends on a good information system. Accurate individual property information, as well as neighborhood-level data enables effective tracking of property conditions and problem properties, and can serve as an early warning system, so that problems can be addressed while they are still manageable.
A flexible and user-friendly computer-based system can be easily updated and made accessible to everyone within municipal government who may need it. Some portion of the information should be available to the public so that CDCs, residents, researchers, and social service organizations, among others, have access to reliable information.
Model Practice
- The Minneapolis Neighborhood Information System (MNIS) provides ongoing training and technical support to system users in the city and the community, including training courses and provision of faculty and graduate students to undertake specific analyses on behalf of the community using the system. Find out more about MNIS at www.cura.umn.edu/MNIS.ph
- Neighborhood Knowledge Los Angeles (NKLA), developed by a team at UCLA for the city and other community stakeholders, works with neighborhood residents, community organizations, and policymakers to generate support for community improvement. Find out more about NKLA at www.nkla.ucla.edu/
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The University of Pennsylvania developed the Neighborhood Information System (NIS) for concerned citizens, the City, planners, and community-based organizations to be able to research where they live, assess the community, and work to improve their environment. Find out more about NIS at www.cml.upenn.edu/nis/
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Baltimore Neighborhood Indicators Alliance (BNIA) is a one-stop-shop for a variety of data, telling the complete story of Baltimore, Maryland’s neighborhoods. While not exactly a property information system, the Alliance helps people make better decisions to improve the quality of Baltimore’s neighborhoods using accurate, reliable, and accessible data and indicators. Find out more about BNIA at www.bnia.org
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Code Enforcement
Code enforcement is the process by which local governments gain compliance with those land use laws, housing codes, building regulations, and permits over which they have authority. Problem properties demand comprehensive approaches to code enforcement to prevent substandard houses from becoming vacant, abate public nuisances, and demolish buildings that are abandoned or beyond repair. Such comprehensive approaches require a blend of compliance strategies and enforcement remedies along with the strategic use of rehabilitation resources and housing assistance programs.
When confronted with a complaint about a derelict or vacant property, the enforcement agency generally inspects the property and issues a notice to the property owner and other responsible parties that list the specific code violations and/or the nuisance conditions. Most code enforcement departments work on a complaint basis. A few cities have designed more systematic inspection programs that target certain neighborhoods or violations:
Model Practice
- TEVO: In 2005 Baltimore determined to take a systematic approach in attacking the city’s 16,000 vacant properties through TEVO – Targeted Enforcement Toward Visible Outcomes. A block-by-block assessment of all of the vacant properties allows the Housing Department to focus code enforcement energies on derelict properties within transitional neighborhoods that have market potential. Read more about TEVO.
- SABER: In 2001 Tucson, Arizona established the Slum Abatement and Blight Enforcement Response Team as a strategy to focus code enforcement and nuisance abatement in key target areas in conjunction with other neighborhood revitalization strategies. SABER brings together the resources of nine city departments, each of which shares responsibilities relating to the enforcement and prosecution of slum and blight laws. By institutionalizing interdepartmental cooperation and coordination, SABER facilitates a more effective response to the problems of vacant and unsecured buildings. Read more about SABER.
Vacant Property Coordinators
For smaller municipalities and townships, having a dedicated investigation team or enforcement unit might not be practical. Another alternative would be to create a vacant property coordinator who acts as a liaison among the various departments, agencies, and property owners. Such coordinators generally take more of a compliance approach than one of enforcement, providing a point person for staff within the local government and a point of contact to work with single-family property owners, realtors, landlords, and neighborhoods. Having a vacant property coordinator has worked well for the city of San Diego over the past ten years, especially in helping owners and the city creatively resolve some of the more complex and sensitive vacant property challenges.
Model Practice
- San Diego’s Vacant Property Coordinator: As part of its Neighborhood Code Compliance Department, San Diego’s vacant property coordinator is charged with a variety of responsibilities: (1) identifying vacant properties throughout the city; (2) maintaining a list or database of properties; (3) administering the city’s abatement ordinance to clean and secure vacant properties; (4) coordinating efforts among city departments (e.g., code compliance, police, and the city attorney’s office); (5) communicating regularly with community groups, the real estate industry, and financial institutions; and (6) performing liaison tasks with the city’s vacant property task force.
See J. M. Schilling, San Diego Case Study.
Property Maintenance Codes
Many cities and townships adopt property maintenance codes that establish minimum standards for the ongoing maintenance of occupied housing. Several national organizations have proposed model property maintainance codes that local governments adopt. The International Code Council’s (ICC) property maintainance code is probably the most widely used. Active enforcement of property maintainance codes can serve to prevent dilapidated properties from becoming vacant and ultimately abandoned.
Model Practice
- Hamilton County’s Planning Partnership: During 2004, The Regional Planning Commission of Hamilton County (Cincinnati) convened a series of workshops and trainings for its local government members on code enforcement and property maintenance ordinances for addressing neighborhood blight. In cooperation with the Professional Association of Code Enforcement (PACE), Hamilton County compiled a wealth of resources and information aboutproperty maintenance for elected officials and administrators, property maintenance and effective enforcement, and legal aspects of code enforcement. Read more about the Planning Partnership.
Nuisance Abatement Authority
Nuisance abatement forms the backbone of the broader code enforcement system administered and managed by local governments. Within the context of vacant properties, municipalities can use their nuisance abatement powers to correct property conditions that pose threats to the public health, safety and welfare. Most nuisance abatement actions are handled by administrative hearing boards, or hearing officers, and not the courts. After a public hearing they can issue administrative orders that allow city work crews or their contractors to take the steps necessary to abate the public nuisance. All costs incurred can then be charged against the property as a municipal tax lien. Failure to pay the nuisance abatement costs could result in the tax foreclosure of the property.
Receivership
Receivership is a powerful legal remedy tool available for preserving distressed residential property, with the goal of improvement and stabilization. Many state receivership laws authorize a municipality or sometimes citizens or a nonprofit housing development corporation to file a civil court action that seeks the appointment of a receiver to take control of a substandard or abandoned building. The plaintiff must provide sufficient evidence that the property’s conditions create a public nuisance—a relatively easy task in the case of most abandoned buildings and vacant properties. The court can then issue a civil injunction or abatement order that gives the property owner or responsible party a reasonable opportunity to abate the public-nuisance conditions before the court appoints a receiver. If the owner fails to comply with the abatement order or fails to respond to the lawsuit, the court can appoint a receiver, who can then make the necessary repairs to rehabilitate the property. Because the receiver’s costs have a higher lien priority than do existing mortgages and encumbrances on the property, many state receivership laws require that all parties who have a financial interest in the property get notice of the civil action and appointment of the receiver. Before the owner can legally reclaim the property, he or she would need to pay the receiver’s repair costs and associated liens. Otherwise, the receiver and/or the local government could acquire the property through foreclosure.
Read more about innovative uses of civil receivership.
Good Practice
Land Banking
A land bank entity is created to help cities turn vacant properties into community assets. They are an efficient way to acquire, hold, manage, and disburse property with clear title. The structure and powers of an entity should be tailored to meet specific local priorities.
Good Practice
- In January 2004, the most extensive land bank authority statute in the country was enacted in Michigan. Unlike other states, Michigan elected to create a “state land bank fast-track authority” with broad-ranging powers to minimize the potential for the state to inherit large portfolios of vacant properties. New foreclosure laws in 1999 authorized the foreclosure of multiple tax-delinquent properties in a single judicial proceeding. In the event that the property is not redeemed by an owner as part of the foreclosure proceedings, title to the property passes to the land bank authority. At each of the first two such tax-foreclosure proceedings in Genesee County, in February 2002 and February 2003, title to more than 1,200 parcels immediately vested in the Treasurer of Genesee County. The bulk of this inventory was subsequently transferred to the Genesee County Land Bank.
Find out more about the Genesee County Land Bank at www.thelandbank.org
Find out more about Michigan’s tax foreclosure reforms on the Policy Development page.
- In 2005, Cleveland, Ohio created a unique land bank for the city, to assemble properties for industrial or commercial redevelopment. This new entity allows the city to strategically assemble large tracts of property to better compete in the market – operating proactively to redevelop its communities.
Find out more about the Industrial Land Bank at www.glefc.org
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