Threaten bank presidents with jail

Speech to Grants Pass City Council, 6/3/09, revised 5/17/11.

            Every once in a while even a firm libertarian looks at a situation and says, “There ought to be a law.”

            A bit over a year ago, one of my customers died.  She’d gotten a reverse mortgage the previous fall, so the bank took possession, just as the housing market began to tank.

            Over the last year, the bank did nothing to maintain the landscaping that I had so lovingly renovated, not even watering and mowing the lawn, which quickly went to weeds over the summer.  What had formerly been a beautiful corner property became an eyesore and a blight on the neighborhood.   It appears to have finally sold, but the new owners have a lot of work to do to fix the neglect.

            I had this property in mind when I heard a program on NPR about a Home Foreclosure Registration program in Indio, California, that requires registration and maintenance of abandoned and foreclosed properties.  Many cities, including Grants Pass, have a property maintenance ordinance.  What is different about Indio’s is that it has teeth:  It is a misdemeanor offense to allow an abandoned or foreclosed property to fall into disrepair.

            Abandoned properties that are not maintained are a hazard to the entire neighborhood.  They bring down property values, spread weeds, become a fire hazard, and attract vagrants and thieves. 

            But property maintenance is expensive, and short-sighted banks find it less expensive to pay fines than to pay for maintenance, especially when enforcement is spotty.  But when bank presidents are threatened with a trip to jail, even just long enough to be booked, it’s amazing how long-sighted they become.

            The City of Indio finds it easy to obtain compliance once they point out that registered and maintained properties sell more quickly and for higher prices than properties that aren’t maintained.

            Grants Pass has a lot of landscape construction and maintenance crews who are getting less work with the lack of new construction and renovation.  (I’m not one of them; my customers are mostly older and retired, and are keeping me busy.)  Those crews can use the work maintaining foreclosed properties.  The neighbors would appreciate the upkeep, which is already required—just not sufficiently enforced.

            Since maintenance is expensive, banks might be willing to work with homeowners in foreclosure to keep them in their homes, or at least occupy them until they sell.  They might also allow occupancy by the dispossessed in exchange for caretaking and maintenance.

            You can obtain a copy of the Registration and Maintenance of Abandoned Properties ordinance at www.indiopd.org under Foreclosure Registration.  Please consider passing a similar ordinance here.