by Bradley Parsons
Staff Writer
City Neighborhoods director John Curtin said Tuesday his department was turning to “batch foreclosures” of 50 to 75 properties at a time to swell the City’s tax rolls and circumvent a costly and ineffective lien collection process.
Curtin said hundreds of outstanding liens have gone unpaid for the last eight years, depriving the City annually of about $1 million. The City spends about $1.5 million each year to inspect and assess liens and to maintain neglected or abandoned properties.
Curtin said his department lacks the statutory authority to enforce codes and collect liens, adding the City would always struggle to collect from hundreds of absentee owners who oversee the troubled properties.
“A lot of the owners are either gone or dead. Either way we’re going to have a difficult time collecting,” said Curtin. “People are quick to point to unpaid liens and say, ‘There’s $10 million in revenue right there,’ and that’s not necessarily the case.”
Rather than pursue futile collections, Curtin’s department instead started foreclosing on the properties by the hundreds. These batch foreclosures send 50 to 100 properties through the county court at about one-fourth the cost.
The City can wait two years and pay $4,000 to foreclose a single property. Compare that to a February batch of 29 properties, which took six months to foreclose and cost the City $39,610 or $1,400 per property. Curtin said the City has since processed 150 lots, with the next batch of 50 to 75 scheduled to close in August.
Once the properties have been foreclosed, the City immediately turns them over to HabiJax — Jacksonville’s Habitats for Humanity chapter — or other non-profit groups, which turn the decrepit lots into affordable housing. By foreclosing the properties and deeding them to HabiJax, the City forgoes collection on outstanding liens and property taxes. However the refurbished properties are returned to the City tax rolls.
For instance, the City spent thousands over 11 years to maintain a decayed single-level house at 1596 30th St.West. But slapping nearly $3,000 worth of liens on the property only made it less attractive to buyers. In 1999, the City foreclosed and handed the property to HabiJax, essentially forgiving the money owed in liens and unpaid taxes. HabiJax built a $75,000 home on the lot, which now pays the City nearly $1,000 in annual taxes. Green grass, pure white siding and crisp red shutters replaced beer cans and rotting tires, and the City broke the cycle of unpaid liens and mounting property debt that likely would have left the property to rot.
“Beyond money, it’s important to remember that degraded property has a negative impact on the surrounding property values,” said Curtin. “It’s to our advantage to find somebody to care for that property other than the City.”
The batch foreclosures have streamlined the process, saving the City money on everything from attorney’s fees to lawn-mowing contractors. William Enright, an improvement officer in the Neighborhood Department’s Clean-it-up-Green-it-up division, said his division spent $150,000 last year to buy properties designated for HabiJax. This fiscal year, Enright said he hasn’t spent a dime. Additionally, Enright said turning the properties over to HabiJax means the City no longer has to hire contractors to maintain the lots.
“This process takes a real negative and turns it into a positive,” said Enright. “We’re putting these houses back on the tax rolls and we’re putting families into these homes. This is what we’re here for.”