Editorial: Keep balance with foreclosures
Detroit needs more residents, and to hang on to the ones it has. It also needs more of those residents to pay their property taxes. Those two truths should inform the handling of tax foreclosures in the city.
More than 60,000 homes in Detroit face foreclosure this year. Wayne County and the city should work to keep as many people in their homes as possible, while establishing payment plans and continuing to reassess property values to minimize future delinquencies.
Roughly $326 million in taxes, interest and fees are owed on the foreclosed homes and other properties in the city.
That's enough money to allow the city to remain in fiscal balance, and also to improve services to make Detroit more liveable.
Much of the delinquency crisis can be traced to the fact that Detroit and Wayne County have been lackadaisical about billing and collecting taxes.
Until recently, the city could barely keep track of who owned which homes, and wasn't sure which homes were occupied. The mailing of tax notices was sporadic.
The county also lacked staff resources to process taxes and foreclosure notices. So since 2005, it has ignored smaller debts until they accumulated for several years.
At that point, the debt was often was unmanageable for the property owner.
The county treasurer changed the policy and now will foreclose on properties once tax payments are three years late.
Certainly, property owners have an obligation to pay their taxes whether or not they receive a notice in the mail. And it's unfair to those who are staying current on their tax bills to have to carry the weight of those who aren't.
But abruptly foreclosing on and evicting Detroiters — some of whom are renters in homes with negligent landlords — is not the best remedy.
If the city learned anything from the water shutoffs last summer, it's that it should work with the county to do everything possible to avoid wholesale evictions. That includes fair notification, grace periods and reasonable payment plans.
About a thousand residents show up at Cobo Hall every day for a hearing on possible options or payment plans that will allow them to escape foreclosure and evictions. That's an indication they want to make things right.
"Overwhelmingly these are people who want to stay in their homes," says Rebecca Thompson with United Way of Southeastern Michigan, one of the nonprofits working to help residents find resources and support at Cobo.
The county will put most of the homes seized in tax foreclosures up for auction.
But that process could take time, and the abandoned homes risk becoming blighted. Better to have them occupied by homeowners willing to make catch-up payments.
Kicking people out of their homes should be a last resort in a city desperate to stabilize and grow its population.
Working together, the city and county should come up with a balanced approach to foreclosures that doesn't enable scofflaws, but allows those who have fallen on hard times a route to staying in their homes and in the city.