Project C.O.R.E Community Meeting June 29

Please attend this important meeting regarding vacants and the implementation of Project C.O.R.E — the city/state partnership to demolish vacant homes.

June 29, 6:00-8:00 PM

Edmondson-Westside High School, 501 N Athol Avenue, 21229

Let the city know where you think we need more demolition, stabilization, or other strategies to address the city’s 30,000 vacant homes!

vacants

Bandit Signs: The New Blockbusting

“I wish they wouldn’t post those here, they make our neighborhood look trashy.”

"WE BUY HOUSES" signs ripped down after a walk. I hear this a lot about bandit signs — those “WE BUY HOUSES” signs that pop up like toadstools after a storm. And yes, they do make a neighborhood look trashy. But even worse — they’re the new tool for blockbusting. For devaluing property — maybe your property. (Hint: It’s a scam.)

In the 1950s and 1960s, blockbusters (usually realtors or “investor” types) would go into neighborhoods to intentionally destabilize real estate prices, in order to snap up properties on the cheap, by “warning” white families that “blacks are moving in next door”. The white family (along with their neighbors, who the “investor” approached earlier) would then flee to the suburbs, but not before selling their property at a ridiculously low price. The investor or realtor would then turn around and sell the property to a black family under a ridiculously rigged “rent to own” scheme, which ultimately led to the financial downfall of many black families in once-prosperous neighborhoods. Many of Baltimore’s neighborhoods in West and East Baltimore are still feeling the effects today, through abandonment, concentrated poverty, subprime lending scams, and sub-standard rental housing. In the late 1960s, most predatory real estate practices were outlawed under the Fair Housing Act, yet many still remain. With new tactics, steering, blockbusting and redlining are alive and well in Baltimore City.

With these signs, shady investors are able to create a culture of urgency and fear in a neighborhood by indicating this is a neighborhood where people are looking to leave…and leave quickly. They’re not a hard sell — they’re usually posted in the middle of the night, quietly. The people who post these signs prey on residents who need money. They prey on residents’ emotions and feelings about their neighborhood. Worse, these signs start to chip away at a neighborhood’s sense of community. Nobody wants to live where they presume a mass exodus is about to take place. These signs are a cheap attempt to divide and conquer. To pit neighbor against neighbor in a blockbusting scheme, 2016 style.

These signs are also illegal. However, the fines are so negligible (and of course so rarely levied that the law is laughable), the investor chalks them up to a business deduction and continues to hang them. My advice? Rip them down. Every time you see one of these signs, rip it off the light pole, off the door of a blighted vacant. Throw them into the trash, and send a message to these people that our neighborhoods are not to be preyed upon. Don’t be a victim to this scam, and don’t allow your neighborhood — your neighbors — to be devalued by these people. Realizing your true worth is the first step towards strengthening your community.

 

Maryland Renters’ Tax Credit: Deadline September 1

The Renters’ Tax Credit is currently only available to low-income and/or senior renters.  However, our legislators did do something positive on this front during this year’s legislative session — the credit has been increased from $750 to $1000. HB340 was signed into law by Governor Hogan in May.

If you think you might qualify for the credit, please go here to download the form and review the current income requirements. The application deadline is September 1, but you can file at any time before then.

Expanding this credit to allow moderate-income renters to apply would provide relief to those who are struggling with rising rents and paying more than 30% of their net monthly income towards housing. This is something we’ll be fighting for in future legislative sessions.

2015 and 2016 Outcomes: Thank You!

Successes and Outcomes: A Look at 2015 and 2016

I wanted to take a moment and update everyone on our progress. As donors, supporters, partners, and friends, I also want to take a moment to say thank you for everything, as none of these successes would have happened without your advice, financial support, and hard work in your communities.

Nuisance and Vacant Properties:
In 2015, 56 properties were brought to the attention of Baltimore Housing, some were put into receivership, some are going through the process now, and some have been demolished or will be demolished, as they were not viable. Only 10 remain with no immediate plan for rehab/sale/demolition. In 2016-2017, we’d like to double the number of properties that are rehabbed/otherwise addressed by Baltimore Housing.

  • Four of these properties were bank-owned, and we were able to get the banks to agree to make repairs or compensate residents for damage caused to their homes by neighboring foreclosures. Many thanks to HSBC and CitiMortgage for being receptive to working together.
  • Advocacy Efforts:
    Because the belief that residents should be advocating for themselves is my top priority, I’d like to expand the series of “How-To” articles on the website, similar to the Rent Escrow and Pre-Lease Signing articles. Giving residents the tools to be their own best advocates is something I believe would best help the city overall.  Email requests, both direct and through the websites, rose by 125% over 2015, with more residents needing assistance with landlord/tenant issues and issues pertaining to vacant homes in their communities.
  • Technical support requests from residents in other cities who wish to start similar projects rose by 40%.
  • Advocacy for affordable moderate-income housing in Baltimore City is another top 2016 priority that carries over from 2015 and 2014, and by mid-2015 there was a strong increase in inquiries from legislators (city and state), small developers, and residents regarding how to implement affordable housing strategies in some of our marginalized communities.

Vacant Property Abatement
This project really started in 2009, with the Slumlord Watch blog and social media campaign. In total, there have been approximately 1300 properties featured on the blog. Recently, I was able to find out from Baltimore Housing what happened to a large percentage of those properties.

Out of the list of properties I sent to Housing, they were able to provide results for 999 of them.

  • 82 are currently under permit
  • 157 have a Use and Occupancy permit
  • 205 have gone through, or are about to go through, the receivership process

That’s a total of 444 properties that are seeing action, which is 34% of all the properties that have been featured on the blog.

Making our communities and our residents has always been, and will continue to be, my number-one priority. I’m proud of the successes we’ve shared, and with more funding (and the ability to grow the project to include more people), together we’ll be able to accomplish even more this year and in the future. Your support is necessary to continue this work, and other projects that will result in a safer, stronger city. Please make a tax-deductible donation today!

Thank you!

Putting Out the Affordable Housing Fire

The Problem

Baltimore’s current affordable housing crisis is yet another fire our government has to put out — despite it smoldering for years, turning into a full blaze right around the same time as the housing bubble and subsequent “bust”, leaving thousands in foreclosure and unable to afford steadily rising rents.

Many cities are faced with the same issue — however, not all cities are faced with a bankrupt affordable housing trust fund.  Seattle and Boston, for example, started thinking about affordable housing in the early 1980s. Hence, they have fairly robust funding sources for a problem that impacts both cities greatly, through construction linkage fees and state/Federal funds.

baltimore_insufficient_housing_nsf_400pxBaltimore currently has no such funding. We have around $70,000 available. (No, that’s not a typo and nor did I leave off any zeros. We have seventy thousand dollars.) In fact, if you read our inclusionary housing law, you’ll find it has little to no teeth, and no substantive funding plan. (Link opens a PDF.)

With our government handing out public funding like candy on Halloween, and no affordable housing requirements, we’re yet again faced with another “crisis” that a proactive government could have forseen long ago.

The Solution

The solution isn’t difficult, yet there seems to be little to no political will to implement anything of substance.

  1. Fund the affordable housing trust through various existing fees and funds: rental registration fees, hotel taxes, condo conversion fees, transfer taxes, CDBG funds. Also, construction linkage fees and affordable housing waiver fees.
  2. Revamp the Inclusionary Housing Board and give a qualified board the ability to provide oversight on development projects.
  3. Rewrite the city’s Inclusionary Housing Requirements to ensure non-compliance comes with consequences.
  4. Ensure that the city’s median income is used when calculating affordability, not the Metropolitan Statistical Area’s median.

What You Can Do Now

Contact your City Council representative and tell them you demand equal housing opportunities for all residents, along with real funding for affordable housing development — not a rubber check.

 

 

The New Redlining

People love data. Numbers. They paint a different, more succinct picture than words sometimes, and they can be turned into maps, infographics, and other visuals that have a bigger, faster impact. However, numbers can be manipulated in a way that allows governments and corporations to create policies that keep poor people away from things that should benefit them the most, like affordable housing developments.

Take Port Covington, for example. The hotly contested development proposed by Under Armour CEO Kevin Plank will be exempt from Baltimore’s inclusionary housing law, yet he has agreed to make 10% of housing in his new development “affordable”. Let’s take a look at the numbers being used to create that housing.

Baltimore City’s median income is $41,000. The Baltimore/Towson Metropolitan Statistical Area has a median income of $86,700, according to HUD. The affordable units in Port Covington will be available to those who earn 80% of the area median income, not the city’s median income. So a single person earning $46,000 a year would be eligible, and a family of four earning $65,700 a year would also be eligible.

The majority of Baltimore City residents, 58% of them, do not earn $50,000 a year. The number of people earning less than $25,000 a year is growing. Yet to calculate what will be deemed “affordable”, we’re using a number that will keep many who need affordable housing out.

Had the “affordable” determination been made using the City’s median and not the MSA’s median, it would have produced a more realistic scenario — a single person earning $32,800 would be able to rent one of the “affordable” units in Port Covington.

In order to make Baltimore’s housing truly affordable for those who need it, we must stop using numbers that aren’t reflective of our city’s population. We need to stop using incomes from the MSA, and use the income levels of our residents to determine affordability. We also need to stop allowing nonprofit groups and corporations to engage in what effectively becomes another way to redline African Americans from new developments in predominantly white communities.

Solution: Close the Tax Sale Loophole

With all of the recent discussion around collapsing vacants, negligent property owners, and the city’s tax sale system, there has been a lot of hand-wringing (and rightfully so, as someone was killed the other day when a vacant collapsed on a man while he was sitting in his car) and mutterings about tax sale foreclosures being “complicated”.

I disagree that the system is complicated — I think “convoluted and rife with fraud” would be a better way to describe what can go wrong after a tax certificate is purchased, including a large loophole in the law that allows the purchaser of the certificate to basically walk away from the whole thing, leaving the city to once again clean up the mess.

The Tax Sale Process: An Example

1234 My Street is vacant. I am the owner, and I’ve moved away, died, or otherwise have abandoned the home and haven’t paid the taxes on the home in some time. The City decides to sell my tax lien at auction.

Along comes Shadytown, LLC, the winning bidder on the tax lien. They immediately have to pay the overdue taxes plus any penalties, interest, etc. owed on the house. They can’t pay the rest of the bid price until they foreclose the right of redemption — meaning, they don’t actually own the home until they take title to the home and receive the deed from the City, if the owner doesn’t pay Shadytown, LLC the money they paid for the taxes. That money is usually increased on the part of the tax certificate buyer — interest, attorney fee, court costs, etc.

I, as the owner, have no intention to pay the taxes, interest, attorney fee, etc., to Shadytown LLC. Now we wait.

As the owner of the tax sale certificate, Shadytown LLC has to wait nine months in order to foreclose on the lien and take possession of the house. Keep in mind, after the tax sale, the taxes keep accruing, as they would for any other property. But still, Shadytown LLC has to wait to see if the original owner is going to pay. After the nine months goes by, and the original owner hasn’t paid the lien, Shadytown LLC has two years from the date of the sale,  to file a complaint for foreclosure with the Circuit Court. Still with me? I warned you, it’s convoluted.

Here’s where it gets ugly: During this time, the property is in limbo. The original owner can’t sell it and Shadytown LLC can’t do anything with it until they foreclose on the lien and pay the balance due. If they don’t pay — the property remains in limbo. And can stay that way until the City decides enough is enough and puts the property back on the tax sale list for the second time, hoping someone else wants to get entangled in this mess. The City has to wait until the two year period has elapsed, so that means another two years have gone by with that house sitting empty, deteriorating even further, creating an even bigger nuisance for the neighbors.

If you’re saying to yourself “Well it sounds like the lien holder can back out and simply walk away from the lien and the property.” — you’d be correct. There’s the loophole. There’s no penalty for the tax lien holder when he walks away from the property, except the money he paid for the back taxes. There’s no penalty for the original owner, either, except the consequence of losing his property in the first place. That’s the loophole that needs to be closed — and fast.

Fees

There are several fees associated with City tax sales that property owners should be aware of:

  • By state law, tax lien certificate holders must be repaid the lien amount plus 18%
  • 6 1/2 months after tax sale, up to $750 in fees and costs may be added
  • 9 months after tax sale, lien certificate holders may file to foreclose the right of redemption.
  • Up to $750 more in fees and costs may be added after foreclosure is filed

Consequences of the Loophole

The most obvious consequence is the fact that the ability of the tax sale purchaser to dilly-dally around and not file the foreclosure on the lien in a timely fashion, thereby leaving the property in limbo for two years. The second consequence is the absolute mess it leaves our property records in, since the original owner is listed in SDAT for years after — even when that owner died many years prior to the house falling into arrears in the first place. The third consequence is to the taxpayers of the city and state. Court costs money. Judges, clerks, etc. are not free or cheap. Nor are attorneys, whether private individuals or employed by the City. When the City has to continually put the same house up for sale over and over again — it’s costing us money. Multiply that one house by the hundreds (if not thousands) “owned” (or not actually owned, because of the loophole) by tax sale purchasers, and you’re looking at a huge waste of tax money. Money that could be spent elsewhere.

Collateral Damage

The people who suffer the most in these situations are the people who live near these homes. They trust that state information is correct, so they go to SDAT and look up the owner of a property and file a 311 or other complaint with the City. Unbeknownst to them, however, that information is wrong more often than not, because of the “limbo status” of the home. Nobody’s being held responsible for the upkeep of the home, and many times, nobody ever will.

What Now?

Closing that Limbo Loophole (as I like to call it) would allow our property records to be updated after the nine-month waiting period between the purchase of the tax lien and the foreclosing of the lien. During the remainder of the two year period, if you hold the tax certificate, you become the owner of record, and therefore are liable for maintenance on the home. The City would report the sale of the tax lien to the State Department of Assessments and Taxation, who would then update the property records to reflect your ownership. If, after the two year period for foreclosure lapses, the ownership would revert to the City and they could sell it again at auction, hoping for a better buyer the second time around. This would produce a chain of ownership, albeit temporary, but would add a layer of accountability we currently aren’t seeing. I daresay that added layer of accountability would prevent some current tax sale purchasers from continuing the process of buying tax certificates and walking away, and it would add a sense of urgency to maintaining the structural condition of the property so we don’t have more residents being killed underneath toppling vacants.

The Housing Questionnaires: Lessons Learned

It’s always interesting to ask a random group of people the same questions and see what you get back. I guarantee at the very least, you won’t be bored. Hopefully you’ll even be enlightened at the end of the process.

Candidate surveys and politics in general are two things I tend to stay away from, particularly now, because things just get so…ugly. I would like to take this opportunity to thank the overwhelming majority of candidates who were thoughtful and polite, who didn’t take potshots at the competition in their survey responses, and who responded within the deadline.

A bit about the questionnaire

The questions and survey deadlines were developed to determine several things:

A few of the questions asked were phrased to see if the candidates understood the laws that govern their job, and the extent of their reach/ability to make certain changes in government. Many candidates appeared to understand their constraints — in fact, a few pointed out that X or Y was outside the control of the office they were seeking. However, a few candidates seemed to be confused as to which office they were actually running for, given their broad responses. A few also seemed to not know the difference between the city’s Housing Authority and Baltimore Housing, which despite being under singular leadership, are in fact two separate bodies with two separate purposes.

A bit about the candidates and their responses (or lack thereof)

The deadline for each group of candidates was clearly stated in the emails. Holding elected office is a 24-hour job, 365 days a week, if it’s done correctly. Constituents don’t care if you’re on vacation, if your cat died, or if you broke a nail and had to spend 4 hours at the Urgent Care. Constituents in Baltimore City have long been ignored by many of their elected officials, and I wanted to see how many people would:

  1. Ignore the questionnaire altogether
  2. Ignore the deadline and cite reasons for not responding in a timely fashion
  3. Argue about whether or not the deadline was reasonable
  4. Change the questions or refuse to answer them as worded
  5. Respond in a timely fashion, answering the questions completely.

Obviously number 5 above was the desired outcome. Few candidates argued about the deadline, though a few did ignore the deadline and gave reasons for not responding. Many candidates, sadly, ignored the questionnaire altogether and did not respond at all. This included most of the “well-known” mayoral candidates and many of the City Council candidates across all of the districts. In Districts 5, 9, and 13, no candidates responded. One mayoral candidate refused to answer the questions given, and instead, provided a lengthy essay that had very little to do with housing; and another mayoral candidate changed the questions, didn’t answer them completely, and then argued for weeks after that her responses should have been included.

A few mayoral candidates apparently had staff communication issues that precluded them from responding. Overall, the communication issues (or lack of communication altogether), argumentative nature of some of the candidates/campaign staff, and a seeming disregard for voters indicated to me that some of these folks simply shouldn’t be running for public office — it felt as though they’re looking to simply collect a paycheck, or use Baltimore as a stepping stone to Annapolis or DC.

Thankfully, we did receive some really thoughtful, solid responses from each group of candidates (Mayoral, City Council President, and City Council). Many of the best-written responses came from outlier candidates who have never before held public office, and had little name recognition. Seeing how much time and thought they put into their answers gave me hope for the future of our city — we need more people like this in our government.

This is an important election cycle for Baltimore City. Thank you to all of the candidates who responded. It was great “meeting” many of you and hearing what you had to say about the state of housing in our city. Best of luck to all the candidates, and here’s to a stronger, safer city for all of us.

 

District 14 City Council Candidates on Housing

Three candidates, including the incumbent City Councilwoman for District 14, responded to the housing questionnaire. Two of the candidate response pages are linked below:

Mary Pat Clarke (incumbent)

David Harding

One candidate, Tom Boyce, sent me an email that simply said “Dear Carol, I don’t know.” in response to the questionnaire. When I replied, asking if perhaps he needed assistance, I didn’t receive a response.

The following candidates did not respond: Terrell Williams and Tia Hamilton.

 

 

District 14 City Council Candidate David Harding on Housing

David Harding was the second District 14 candidate to respond to the questionnaire. His answers are below, with no edits:

1. Baltimore City has 30,000+ vacant homes. How do you intend to clean up blight in your district that isn’t a rehash or continuation of previous plans? And how do you propose to pay for your plan?

I support the residents of Poppleton who have been organizing to stop the spreading of the Biopark. And I would use the City Council office to encourage exactly that kind of organizing. It’s first of all, a fight to be able to stay in their homes – to not be pushed out. Keeping people in their homes stops blight. But it’s also an example of ordinary people standing up to powerful interests that suck the blood from the city. In this case, it’s the Blackstone Group. In March, the City Council voted to grant this billionaire company a 17.5 million dollar TIF for the Biopark.

I would do exactly the opposite in the City Council. Not only would I vote “no” to every TIF, PILOT, Enterprise Zone, and other form of corporate welfare. I would also publicize – actively — every slimy deal that the City Council is considering. I would do it quickly, so that the residents hear about it before the City Council vote is taken. And I would make all the resources of the City Council office available to residents who want to stand up, whether they live in District 14 or in other parts of the city.

Blight isn’t an accident. It’s a conscious policy decision. There’s an overall lack of enforcement against landlords, both for their vacant and their occupied properties. Neighborhoods are allowed to deteriorate. Then after they somehow “become” deteriorated, they are handed to a developer in the name of saving them. But those hundreds of millions of dollars that go to the developers could instead be used to hire directly. We’re never going to fix 30,000 vacant homes with a couple hundred employees. The city needs tens of thousands of employees. And it could hire that many, and with decent pay – with the money that now goes to developers.

2. The two fastest-growing income groups in Baltimore are those who earn 75,000 and up, and those who earn 25,000 and below. The middle class is stagnating, and struggling to afford rental housing. How do you propose to keep median-income renters from leaving the city without pushing them into homeownership they may not want or be able to afford?

You’re asking the wrong question. The right question is why the City Council allows wages that low in the first place. We all know that $12 an hour, or even $15 an hour can’t begin to pay the rent. The City Council could certainly take up the question of the minimum wage. But it hasn’t looked in that direction. Just like it continues to feed city tax breaks to companies that pay workers poverty wages, even while these same companies drive up the cost of housing.

The City Council could take a completely different approach by using city money to hire city employees at decent wages. It was mentioned in a recent City Paper column that in the past seven years, not one single student in the Reach Partnership High School trades program has been placed in a trade-related job. And yet it’s the city that owns more vacant properties than any individual landlord or LLC. The city could solve both problems by hiring these trade school graduates at decent wages. When people have money, they can spend it at stores, restaurants and other small businesses. When small businesses have customers, then they too can hire. The city itself could become an engine for economic growth — if it turned its budget priorities in a completely different direction.

3. Our Housing Authority has a decades-long reputation for corruption and incompetence at its top leadership tier. How do you plan to address this?

It’s not incompetence. It’s policy. The Housing Authority has been following in the footsteps of the City Council. The Housing Authority, for example, is selling off 40 percent of its housing stock to private developers. These fire-sales are happening at hundreds of millions of dollars below market value. Plus, the developers will get hundreds of millions of dollars of property tax breaks over decades. The deal was made in secret. Sun reporters only discovered it months later, after digging around for the records.

Is it corrupt? Absolutely! But not one shade different from what the City Council has approved, catering to every whim of developers. It was the City Council that approved a 40 million dollar tax break to Amazon, and approved a TIF of 70 million for Paterakis at Harbor Point. They gave away millions more for the Convention Center and the Casino. The City Council could have opposed all of these – and it chose not to. And now they’re working out the details of the TIF to Kevin Plank’s Port Covington. It’s a record setting request – over half a billion dollars. To put it in perspective, the entire 2015 operating budget of the city of Baltimore is only 2.2 billion.

I would oppose all these TIF’s which are a public subsidy to billionaires. TIF’s force the city to starve its operating budget – the part of the budget that serves ordinary people. The library branch closings in 2003, the fire station closings in 2012, the recreation center closings were all due supposed budget crises. Of course it doesn’t happen all at once. It’s a death by a thousand cuts. The city closed ten neighborhood branch libraries and later opened one new “regional” library in Highlandtown. But the total library system operating budget is reduced. Schools lose their heat and it never gets fixed. Water pipes go yet another year without replacement and then break. Temporary city hiring freezes become virtually permanent. All to feed the unlimited appetite of a few billionaires who would dare to blackmail the city, threatening to take their business out of the city if they don’t get tax breaks. It’s a spending policy that puts Baltimore on a race to the bottom – a race to become the next major city to file for bankruptcy.

4. Its been said that Baltimore’s tax sale process is burdensome to seniors and low-income residents, forcing many out of homes. How do you plan to make this process easier for those who are struggling to pay for their water bills and property taxes, and how would you better structure the city’s tax sale process to ensure homes aren’t purchased and subsequently neglected?

You’re looking for a more gentle way to kick retirees to the street. I’m not. I’m opposed to tax sales on any owner-occupied property and would try to stop them on the City Council. Stopping them would be an immediate step the City Council could take to reduce blight.

Look what happened when RG Steel went for several years without paying its water bill, until the bill grew to seven million dollars. Did the city proceed with a tax sale? Think again! RG Steel walked away, leaving the city with the unpaid water bill, plus site cleanup costs of hundreds of millions of dollars.

And yet for residents, water bills have doubled in a couple years. Property tax bills for ordinary people have increased. When bills go up, and wages stay the same, it’s inevitable that some won’t be able to pay. And who is that likely to be? Those with disabled children, those whose retirements were stolen by Bethlehem Steel, General Motors, and Western Electric; those who may have worked their entire lives for the city but were denied a permanent job with benefits.

Already victims, the city will then victimize them further by selling that debt to an “investor” who will gouge them for additional interest and fees. A $500 city water bill turns into a $3,000 private debt with the threat of foreclosure. If they can’t pay it, they not only lose the roof over their head, but all the equity they’ve paid on the mortgage. The property ends up vacant. And that brings down the standard of living of the whole neighborhood.

5. If you plan to introduce a reduction in property taxes, please indicate that, but also indicate how you plan to make up for the lost revenue.

[Please note, Mr. Harding skipped this question entirely and offered no response.]

6. How do you propose enforcing Baltimore City’s inclusionary housing law?

I propose not to enforce it. It’s another law that was written by the developers, for the developers. It creates public housing, but not the kind of public housing we need. It creates publicly paid, luxury housing for the very wealthy. The number of so called “affordable” units the law created was 32. We need real public housing – housing that’s comfortable and affordable by a worker’s standard.

7. Is there anything else voters should know about your approach to housing in District 14?

I understand that one person, or even a couple people on the City Council can’t take down the developers and the big banks that are behind them. But the working people of Baltimore have every reason to stand up against these billionaires who are parasites on the city. Working people have been living in the city, paying taxes here, paying their rent and mortgage, making the city run for decades – for generations. They have every reason to stay. They have every reason to stand up against anyone who would try to push them out. And I would use the City Council office to support every fight, to give out all the information possible, and to open up the office for their use to organize.