Presenting a live 90 minute webinar with interactive Q&A Foreclosed, Distressed and Abandoned Properties: Legal Challenges for Municipalities Leveraging Ordinances, Judicial and Agency Proceedings, Land Banks and Other Tools to Minimize Burdens and Maximize Opportunities TUESDAY, AUGUST 23, 2011 1pm Eastern 12pm Central 11am Mountain 10am Pacific Td Today s faculty features: Dwight H. Merriam, Partner, Robinson & Cole, Hartford, Conn. David S. Silverman, Partner, Ancel Glink Diamond Bush DiCianni & Krafthefer, Chicago Julie A. Tappendorf, Partner, Ancel Glink Diamond Bush DiCianni & Krafthefer, Chicago The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 10.
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FORECLOSED, DISTRESSED AND ABANDONED PROPERTIES: LEGAL CHALLENGES FOR MUNICIPALITIES Leveraging Ordinances, Judicial and Administrative Proceedings, Land Banks and Other Tools Tuesday, August 23, 2011 1:00 pm Eastern Time Sponsored by the Legal Publishing Group of Strafford Publications
Today s Speakers Dwight Merriam, FAICP, Robinson & Cole, LLP 280 Trumbull Street Hartford, CT 06103-3597 Direct Dial: 860.275.8228 dmerriam@rc.com www.rc.com com David Silverman, AICP, Ancel Glink 140 South Dearborn Street, 6th Floor Chicago, IL 60603 Direct Dial: 312.604.9160 dsilverman@ancelglink.com www.ancelglink.com Julie Tappendorf, Ancel Glink 140 South Dearborn Street, 6th Floor Chicago, IL 60603 Direct Dial: 312.604.9182 jtappendorf@ancelglink.com www.ancelglink.com 6
Introduction ti I. Impact to Municipalities from Vacant, Distressed & Abandoned Properties II. Enforcement Tools III. Available Strategies 7
Part 1: Impact on Municipalities i 8
The State t of the Market Each abandoned home costs the City of Chicago $34,000 annually Cost of one foreclosure is approximately $80,000 (municipal expenses, loss of value to foreclosed property and adjacent property, bank costs, etc) 9
Impact on Municipalities i Direct (Financial) i Indirect Costs: Costs: Decrease in Revenues (taxes, fees, utility charges) Building Inspections Maintenance and Security Legal Fees and Court Costs Demolition Crime Decrease in Property Values Devaluation of Community Character and Aesthetics ti Social Services 10
Part 2: Enforcement Tools A. Property Maintenance Ordinances B. Administrative Adjudication Systems C. Vacant Building Registries D. Demolition 11
Property Maintenance Codes Municipalities typically have either statutory or common law authority to enact property maintenance codes to regulate: Weeds, landscaping, and dead vegetation Trash, junk, and debris Building materials Accumulation of newspapers, flyers, notices Dilapidated and unsafe condition 12
Code Enforcement Administrative Adjudication of Code Violations (sometimes referred to as housing or municipal i court) 13
Vacant Building Ordinance Maintain i vacant buildings and properties Prohibit window and door boarding and encourage other security measures Remove discarded personal items, furniture, and appliances Secure critical systems (electrical, HVAC, plumbing) Secure vacant buildings (closure of windows, doors, gates and fixing broken windows) Weekly municipal inspections of vacant buildings and properties 14
Vacant Property Registry Require registration of all abandoned and vacant property within municipality Registration fee Post name and contact information of responsible party Monitor and enforce property maintenance 15
Inspections All properties in vacant property registry Systematic exterior inspections Prioritized enforcement Monitor properties for compliance Registry shared with police and fire departments 16
Notifications Bank and Real Estate Service Company Databases Bimonthly E-Mail Blast Informational Cover Letter Foreclosure Database Explanation of Relevant Code Sections List of Local Contractors Building Securing Companies Junk Haulers Landscape Contractors 17
Demolition Demolition, Repair, Enclosure, or Remediation 18
Part 3: Available Strategiest A. Letters of Credit and other security B. Land banking C. Special financing tools D. Zoning Strategies E. Nuisance Abatement F. Development Partnerships 19
Letters of Credit and Other Security Understand the Status of the Project Determine status t of security for public improvements Communicate with Residents Bankruptcy Issues Future Developer Concerns security/letters of credit & transferee assumption requirements 20
Land Banking A land bank is a public or quasi-public authority created to efficiently acquire, hold, manage, and develop foreclosed property, as well as other vacant and abandoned properties 21
Financing i for Landbanking Federal funds Taxes Bonds Mortgages Installment Purchase Agreements 22
Other Finance Mechanisms Tax Increment Financing Other special district programs authorized under state law 23
Zoning Strategiest Zoning Strategies Diversification of Land Uses 24
Zoning Strategiest 25
Zoning Strategiest Allow modest improvements to existing nonconforming properties Relief to distressed properties to reposition them for resale/redevelopment Zoning modifications for stalled developments Be flexible & creative 26
Diversification ifi of Land Uses Retail Generates sales tax Service Increases day-time population p -- more sales tax from restaurants and convenience- oriented retailers Generates traffic complementary to retail Can generate sales tax Office Industrial Enhances utility taxes Increases day-time population 27
Nuisance Abatement t General common law authority to abate nuisances 28
Development Partnerships Opportunity to redevelop areas using public-private partnerships 29
Q&A Dwight Merriam, FAICP, Robinson & Cole, LLP, David Silverman, AICP, Ancel Glink Julie Tappendorf, Ancel Glink 30