A Milwaukee law forcing property owners to renovate or demolish foreclosed homes is putting muscle behind a growing disgust with vacant properties.
The law dovetails with such local groups as Southeastern Wisconsin Common Ground, which is an organization of religious congregations and social groups mounting a public campaign arguing lenders that foreclose on houses have a social responsibility to fix them.
“They own the property,” said Willie Davis, pastor of the Greater New Birth Church in Milwaukee, “and they have the money and they are the ones that allowed this foreclosure crisis to happen. They gave the bad loans.”
But U.S. Bank, one of three banks Common Ground is targeting, cannot fix or demolish most of its foreclosed houses in Milwaukee, said spokeswoman Lisa Clark. The Minneapolis-based bank owns the loans on four properties in Milwaukee, she said.
As for the hundreds of properties Common Ground claims U.S. Bank controls around Milwaukee, Clark said, the bank is only a trustee representing other owners. The bank, she said, is in no position to work on those buildings.
“Legally, we can’t because we don’t own those buildings,” Clark said. “I can understand where they are coming from.”
Actually, the banks, as trustees representing multiple loan owners, are responsible for the properties, said Catey Doyle, Legal Aid Society of Milwaukee chief staff attorney who has been advising Common Ground.
“They would have the same obligations as any other property owner in the city of Milwaukee,” she said.
But the city of Milwaukee this month is cutting through the debate with a law mandating some of the repairs Common Ground is seeking. Starting this month, vacant properties must be registered with the city, and the entity that registers the property, whether it’s a bank or trust, must pay $250 every six months to register with the city, said Art Dahlberg, commissioner of the Milwaukee Department of Neighborhood Services.
The fees double and triple if a property owner does not follow city laws to maintain building exteriors and board up properties to prevent break-ins, he said. The fines will act as an incentive to get houses renovated or demolished so new owners can buy them, Dahlberg said.
“What this does,” he said, “is it redefines the obligation of property owners to take care of their properties in the community.”
Mark Fraley, lead organizer of Common Ground, welcomed the city’s efforts. Common Ground organizers are pressuring the three banks to dedicate a combined $75 million to renovate or demolish vacant houses in the city.
“What we need is as many folks working on this as possible,” he said. “I don’t think it’s an either-or; it’s a both-and.”
Davis said he will remain committed to trying to get money out of the banks to renovate the buildings.
“We’re still waiting for a sit-down with those who can make the decision,” he said, “those who have what we want, which is $25 million.”
I think they should sell them at a fair price and start auctioning them off to rehabbers.