Op/Ed: Abandoned houses are a problem in Indiana, land bank bill could help reduce blight
In 2007, the subprime mortgage market collapsed and in the following year (2008) it brought the housing market with it. In 2014, the U.S. Treasury created the Blight Elimination Program using revenue from the Troubled Asset Relief Program (TARP) to demolish blighted residential structures. The city of Muncie was able to demolish over 200 blighted residential structures through the Blight Elimination Program. However, that is still not enough to combat residential blight in Muncie.
Over the last three years there were approximately 600 properties in the county tax foreclosure sale, meaning 600 properties failed to pay or make arrangements to pay three property tax installments. Approximately 400 of those properties did not sell in each year and are just left to the next round at the same time they are being demolished-by-neglect. At the same time, there are approximately 60 unsafe building hearing cases each month with about 15 of those being new cases. On average only a third of unsafe building owners appear at the hearing. Tax delinquent, building code deficient and no responsive owner are the characteristics of an abandoned property. Abandoned property cost citizens of Delaware County in taxes and in the health and well-being of residents. It affects neighbors and creates areas of crime disproportionately more.
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House Bill 1147, which would provide pathways for county and municipal governments to more effectively address property abandonment, is currently up for debate in the Indiana General Assembly. The legislation spells out options for funding land banks and makes it easier for land banks to coordinate with the county to identify abandoned properties that need intervention.
In the early morning of Dec. 3, 2022, the firefighters were sent to 1003 E. Seventh St., which three properties had caught fire. As the Muncie Fire Department first responders battled the blaze one firefighter was injured. At the same time, three houses were ruined. This recent story is part of a broader pattern, police and firefighters are disproportionately called to respond to problems in abandoned properties. Police runs to address squatters; fire runs to address those same people seeking to keep themselves warm in the winter with no appropriate heating infrastructure.
Land banking helps address this problem in two ways. First, putting problem properties in the land bank’s possession creates a local responsive owner who will secure the property, keep it clean and mowed. Right now, if a property owner decides not to pay taxes and leave town, the city and county do not have the tools to take care of a vacant house and so, blight spreads. Land banks, like the one in Muncie have the information needed to pinpoint which properties are problematic, acquire them and make sure that they are secured and safe. Second, land banks help increase the supply of available housing so that fewer people are forced to squat. The Muncie Land Bank, which operates on a shoestring budget, mostly provided by our local foundations, has been able acquire 71 properties and holds a monthly auction for responsible buyers. In Indianapolis and Evansville, where land banks are more robustly funded by their respected local governments, their land banks have acquired and sold hundreds of abandoned properties to vetted buyers.
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House Bill 1147 is worth the support of our state law makers because it provides flexible tools and no mandates that give county officials options for funding land banking and encourage information sharing between counties and land banks. I am particularly enthusiastic about a local option to create a fee for those who wish to purchase property from county lien and deed sales. Too often the buyers in these auctions never take care of the property they buy, because they are out of state, or out-of-county speculators. About 30% of these properties return to the tax sale after being sold and about 50% are listed in more than two tax sales. House Bill 1147 is a well targeted and flexible tool to reduce blight, save money and reduce the risks to our first responders.
If communities want to combat residential blight, we need land banking with funding mechanisms and troubled-property pipeline. House Bill 1147 moves Indiana in the right direction in getting these needs.
Brad King is chair of the board of directors of the Muncie Land Bank Inc.
Roza Selvey is Republican candidate for Muncie City Council at-large.
This article originally appeared on Indianapolis Star: Land banks offer a solution to reduce abandoned houses in Indiana
