Milwaukee mayor pushes for continued work on tax-foreclosed properties

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While Milwaukee Mayor Tom Barrett was touting the city’s progress in getting foreclosed homes back into the hands of responsible property owners, lawmakers in Madison were pushing a bill that would weaken the city’s ability to force certain foreclosed homes back on the market within a handful of weeks.

As part of his annual State of the City speech, Barrett said the city sold 511 tax-foreclosed homes last year. Of those, about 60 percent went to owners-occupants.

“In the most recent assessment, citywide property values are up,” he said Monday at the Hmong American Peace Academy auditorium on the city’s northwest side. “In light of the turmoil in recent years, that’s very good news.”

Yet, even amid that progress, the state’s Republican-controlled Legislature was considering a proposal that critics warn would weaken Milwaukee’s ability to deal with so-called zombie properties. The designation usually refers to houses that have been foreclosed on yet whose titles, for whatever reason, have not been taken over by the mortgage holder. The houses are usually abandoned, making them targets for looters and squatters.

Current law, which the Wisconsin Supreme Court upheld in 2014, requires lenders to sell any property that has been foreclosed on and abandoned. The sale must occur following a redemption period now set at five weeks.

A bill being considered in the state Assembly would instead give lenders up to a year to decide what to do with these properties. The bill’s primary sponsor is Terry Katsma, a Republican from Oostburg.

Both Milwaukee and the League of Wisconsin Municipalities have come out against the bill. The Wisconsin Realtors Association has taken a neutral stance, although an association official indicated there’s more they like about the bill than dislike.

Cori Lamont, the group’s director of corporate and regulatory affairs, said that while the WRA largely supports the measure, it does question the expanded 12-month window that the bill would grant lenders.

She said a tighter window would be more ideal. The group does support the bill’s other provisions, particularly one that would cut redemption periods in half in certain types of foreclosure cases.

As a direct result of the global recession that began around 2007, Milwaukee was hit by a succession of foreclosure waves. The lingering effects of the downturn left many homeowners unable to keep up with their mortgage and property-tax payments.

Houses that sat unoccupied for lengthy periods gave rise to neighborhood blight. Neighbors’ property values were driven down as a result.

Since then, the city has invested heavily in various measures meant to forestall another wave of foreclosures.

One of Milwaukee’s initiatives on that front is the STRONG Home Loans program, which provides loans to homeowners who, because of declining property values, cannot get a standard loan. Many of the loans go toward exterior work, such as roof replacements and siding repairs.

Months after they first began STRONG Homes in January 2015, city officials announced the program was no longer taking applications because it had used all its money by around May.

“Across a broad swath of Milwaukee, city-owned foreclosed homes have been lowering property values for neighboring city properties … and disrupting the character of residential areas,” Barrett said. “Now, when we get a family to own and live in a vacant home, they are restoring the fabric of the neighborhood.”

Workforce investment body gets facelift

Barrett also announced Monday that Milwaukee Area Workforce Investment Board Inc. is changing its name.

Starting this year, the nonprofit that matches job-seekers to possible employers will be called Employ Milwaukee.

Earl Buford, the group’s president and chief executive officer, said this is the latest change to come about over the past year and a half.

“It goes back to basics of what a workforce board is,” he said, adding it also matches a national trend.

Northwestern Mutual project highlighted

Barrett also took time Monday to make special mention of the benefits conferred on the city by the ongoing Northwestern Mutual Tower and Commons project.

He said local small businesses have performed about 30 percent of the work on the project and that more than 40 percent of work hours have come from workers involved with the city’s Residents Preference Program.

“These local workers are earning wages, gaining experience and contributing to the local economy,” Barrett said.

He also noted work has recently begun on the 33-story residential and commercial building next to the 1.1-million-square-foot, 32-story office building going up at the corner of Mason and Van Buren streets. Follow @alexzank