Boston has been feeling the impact of rising foreclosures and abandoned homes. Now they want the owners to pay: [Thanks L!]
City officials are lining up an arsenal of new tax penalties and stronger regulations to help rid the Hub of the abandoned and foreclosed properties that are blighting neighborhoods as a result of the national mortgage crisis.
“It is a real scam and it’s happening in so many cities throughout America,” said Mayor Thomas M. Menino, who was updated yesterday on efforts to revive the foreclosure-ravaged Hendry Street area in Dorchester during a revved-up meeting with 20 city officials in a new “war room” at City Hall. “All the predictions are that the worse is yet to come.”
Menino yesterday filed a home-rule petition with the state Legislature that would slap a new levy on homeowners, mortgage lenders and mortgage servicers who leave properties vacant and abandoned for more than one year. The so-called “non-utilization” tax would be set at 10 percent of the property’s assessed value, said corporation counsel William F. Sinnott.
And if that’s not enough:
Another measure that targets the banks and mortgage servicers that assume ownership of foreclosed properties also received unanimous approval from the City Council, said Hyde Park City Councilor Rob Consalvo, who sponsored the new ordinance.
The regulation would require all vacant and foreclosed residential properties to be registered with city inspectors and be maintained by a local management company, Consalvo said. Owners who didn’t comply would be fined $300.
“We shouldn’t be footing the bill for that. It should be Deutsche Bank or World Bank, not the taxpayers of the city,” said Consalvo, who routinely fields complaints about unsecured swimming pools, unshoveled sidewalks and debris at foreclosed properties.
Certainly the costs associated with abandoned homes are putting a strain on city budgets, but how much luck they are going to have collecting these fees from troubled lenders and homeowners is anybody’s guess.
Seems like it would just encourage more people to walk away and screw the bank. If you were having trouble renting a house but didn’t want to foreclose, now it seems like a no-brainer – rent it for a loss or pay tens of thousands in taxes?
I’d expect some lawyers from the banks to chime in on this soon.. I doubt they have the cash to do this if other cities joined in. And what about the home builders? If they build homes and can’t sell them, are cities going to require them to pay this tax as well?
Granted, it’s a tough problem.. too many abandoned homes are hazardous for many reasons, but push things too far and you’ll just hurt yourself when the recovery finally begins. Who’d want to invest in a city that badly burned investors in the past?
Mumbles Menino never met a levy or power grab he didn’t like.
I almost wish my daughter would go for a degree in Contract Law. It will be decades before all the lawsuits are finished and she could make a nice living at it. Nah…if she went through that Law School brain washing…she’d just wind up a Lawyer.
Igor says noidea