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Las Vegas Council approves foreclosure ordinance
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LAS VEGAS REVIEW-JOURNAL
Banks that own vacant, dilapidated properties in Las Vegas could face fines or jail time under a city ordinance approved Wednesday.
The City Council voted unanimously for an ordinance that requires banks to list empty, foreclosed properties on a registry and contains misdemeanor penalties for allowing a property to fall into disrepair.
The ordinance, sponsored by Councilman Steve Ross, is an attempt to reduce blight associated with vacant homes and commercial properties.
"This council and this community is tired of these blighted buildings," Mayor Carolyn Goodman said.
Bill Uffelman, president of the Nevada Bankers Association, said he supports the efforts to reduce blight but objected to the misdemeanor penalties, which could include fines or jail time.
"No bank that is a member of the Nevada Bankers Association has a senior VP who is in charge of going to jail," Uffelman said. "It isn't going to work."
SPARKED BY BLIGHTED HOUSES
The foreclosure ordinance has been in the works for months.
Ross first proposed it in October as a response to the high number of blighted properties in his Ward 6 and throughout the city.
Chris Knight, director of the department of building and safety, said that as the foreclosure epicenter of the United States, Las Vegas is burdened with a high number of houses with green pools, broken windows, overgrown weeds and vandalism.
The blight is an eyesore for neighbors, can attract crime and can diminish the value of nearby properties.
Knight said that in August, a month city officials used as a sample, there were more than 320 newly vacant lender- or bank-owned homes in the city.
At that rate, there would be nearly 4,000 such houses annually.
According to information provided at the meeting, Las Vegas is home to about 28 percent of the estimated 100,000 distressed homes in Southern Nevada.
"That clearly indicates the issue of foreclosures is not going away anytime soon," Knight said. "This could be a 10-year problem."
All homes, those in foreclosure and those in good standing, are subject to residential landscaping and maintenance codes. When codes are violated, homeowners can be assessed. If the assessments aren't paid, then the city can hire companies to drain a foul pool or remove overgrown weeds with the cost passed along to the owner.
If the costs and penalties aren't paid, the city puts a lien on the house that must be paid or forgiven before someone else can buy it.
The City Council regularly hears from would-be homeowners who find a house they like only to learn it has thousands, or even tens of thousands, of dollars in liens against it because the previous owners didn't pay maintenance assessments.
The ordinance would reduce such instances because the registry would track empty bank-owned properties, and the stiffer penalties would compel banks to care for the houses.
BANKS: city ASKING FOR TROUBLE
But Uffelman said many of the problems with vacant properties occur after the homeowner stops making payments but before the bank takes ownership, a period that can last more than 400 days.
He said banks could be in a position to be responsible to care for properties they don't legally own.
Uffelman also said landscaping standards that require irrigation could force banks to maintain active electric and water service at vacant properties, which might result in more problems by encouraging squatters.
"It is very difficult complying with this ordinance. That is really asking for trouble," he said.
Uffelman didn't find much sympathy on the council for concerns from banks, who many blame for the dysfunctional housing market that crashed and resulted in the foreclosure crisis and broader recession.
Goodman said the potential misdemeanor penalty is needed to give the ordinance teeth.
Knight said under the ordinance, banks would have 15 days after a notice of default to inspect a property to determine whether it is vacant. If it is vacant, they will have 10 days to list it on a city registry at a cost of $200.
The property then needs to be maintained in compliance with health and safety codes.
If a bank or lender fails to comply, it would get a notice, then a citation and, if it doesn't comply, a possible misdemeanor citation, which could result in a $1,000 fine or six months in jail.
Councilwoman Lois Tarkanian said the ordinance wouldn't have been needed had banks, lenders and other institutions done a better job cooperating with the city's efforts to maintain neighborhoods.
"They treated us with disrespect, they treated the citizens with disrespect, so we said we have to do something," Tarkanian said.
"We've tried to correct this problem and have not had help from the banks. We're moving in the direction we need to."
Contact reporter Benjamin Spillman at bspillman@reviewjournal.com or 702-229-6435.
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Folks this is a NON ISSUE. Our company for the past seven years (RHS-LLC SW) has offered a program where we pay for all maintenance of any vacant property. This is a FREE SERVICE to all Homeowners and Lenders with vacant properties. We pay for all maintenance, utilities, yard and pool maintenance and repairs. We provide temporary housing for people in need that have been displaced and need housing we charge them a minimal fee to cover the cost of maintenance. This bill is GOOD for EVERYONE, including the Banks. They have NO COST at all and a very salable property that does not distress the neighborhoods or turn into CRACK Houses. The properties we maintain sell for more money and much quicker after the go back on the market. Call me direct for more information anytime.
A.J. Basile CEO / RHS-LLC SW 208-863-4205
@bghs1986- Prison Uniform Fridays?
@Tracey.Donley wrote on December 08, 2011 08:35 AM: Sorry, I did't mean to sound so cynical, but you lost me with funding a police task force, "gang like"behavior, EMPLOY and then bill the banks at a reasonable rate.
I don't think this ordinance is necessary. The city should simply enforce their liens and auction off the properties if they aren't paid. I don't know how they will put any "bank" executives in jail. Most mortgages have been pooled and resold to villagers in Norway with all papers robosigned in Nebraska. Good luck proving a criminal charge against any individuals.
It seems that there is a disconnect here. All of the vacant houses, and yet hordes of homeless wandering the streets. Would not some of those homeless be glad to have a roof over their heads, and might, just might, be willing to at least maintain the places, cut grass, etc., and the banks would benefit from having the places at least looked after. Maybe there could be a registry for families to be assigned to certain places. I know there are a lot of complications, but instead of blackjacking the banks, how about some municipal incentive for something like this. Get the churches involved to police the homeless occupants.
"Banks that own vacant, dilapidated properties in Las Vegas could face fines or jail time under a city ordinance approved Wednesday." Just wondering if the entire bank will be put in jail, or just the branch nearest the home in question? Will the bank be forced to wear jail clothes?
one good result about those "occupiers". the process servers, constables, federal marshals, local cops can serve or arrest, the deadbeats, the criminals in the wind, the open warrants, the "persons of interest", the gang bangers, illegal job stealers, all at once. gotta be a savings fir taxpayers, corralling the delinquents in one tidy herd.
@Husky: Your comment was lost on me... Say what you mean, and mean what you say. At least I have the courage to use my proper name and not hide behind a moniker that does not identify me directly. I maintain that this ordinance was poorly thought out, and will ultimately be funded by and large with our federal tax dollars.
"Mac wrote on December 08, 2011 10:31 AM: The nanny state thrives in LV I guess. What a bunch of socialist council members. This is disgusting. A registry? What's next? A registry for Jews? Arabs? Japanese?"
Yes, those are next. Registries for Jews, Arabs, Japanese and Macs. Also, bridal registries.
those little old lady investors, owners of that "everyone deserves a house" paper deserve some punishment, right ? same with those union pension funds, bloated with bundled, toxic mortgages. those union drones have been screwing the rest of us for decades, so they can now get their "fair share" of punishment.