zombie properties

Operation Keep Our Homes, a program designed to identify and reduce the number of vacant and abandoned homes in the City of Batavia, is making some positive strides, according to the administrative intern who has been working on the program for several months.

Speaking at tonight’s City Council meeting at City Hall, Lindsey Luft, a graduate assistant at Brockport State College who has been serving the City since May, said the initiative has just about reached its goal of connecting with 10 families facing foreclosure.

“We have been working with nine families – one kept their home, one the case was closed and seven others are still open,” said Luft, who is on track to earn her master’s degree in Public Administration in the spring.

Luft said there are about 89 zombie properties in the city – “and we’re really focused on getting them up and rehabilitated.”

“It (vacant homes) affects the City at all levels and at every census tract, and it’s not targeted at any kind of income level,” she said.

Operation Keep Our Homes utilizes a database called Opportunity Space, Luft said.

“We load all kinds of information (gathered from county, town, city, police and fire data) to narrow down our search for zombie properties,” she said. “And from there, with the targeted list, we go out to site visits and we confirm vacancy.”

Luft gave City Council members a demonstration of the software, starting with 5,453 parcels in the City, and using various filters -- such as floodplain property, whether there is a structure on the site, water usage and residential homes – to reduce the list of targeted properties to a manageable number.

Filtering allows officials to come to the conclusion that “there is reasonable cause to think they can be vacant properties and to go to them, instead of aimlessly wandering around,” she said.

Luft said currently the database is updated quarterly, but the plan is to be able to access the information in a “real-time situation.”

During her presentation, she outlined the Zombie Property Remediation Act’s four components – requiring lenders to maintain mortgage-delinquent properties, requiring mortgagees to register vacant properties with the NYS Department of Financial Services registry, allowing mortgagees to complete expedited mortgage foreclosure for abandoned property, and enhancement of consumer protections.

When the DFS determines that a property is vacant, municipalities working with the Local Initiatives Support Corporation can act to remediate the property with the goal of getting it back on the tax rolls. Luft said that Batavia is one of 77 municipalities that have received grants from the LISC to achieve their goals. The City reportedly received a $66,500 grant. 

She said that Batavia’s strategy includes educating individual property owners, using the Internet and local media to reach at-risk persons privately and reaching out to entities such as the Housing Council at PathStone, Genesee County Bar Association, banks, realtors, local pastors and Habitat for Humanity.

City Manager Jason Molino said that Habitat for Humanity has rehabilitated one single family home per year in the City over the past eight years, “producing a 38-percent average increase in assessed value after rehabilitation.”

Batavia also has a property tax exemption in place for residential redeveloped property, and is in the process of partnering with a local bank to develop a mortgage package aimed at redeveloping a zombie home by utilizing the exemption.

The Operation Keep Our Homes program also seeks to revise the City code in the areas of grass, weeds and debris; solid waste (cars) and graffiti.

Toward the end of her talk, Luft was met with a question from Councilwoman Rose Mary Christian, who wondered why some properties with paid-up mortgages were vacant.

“What’s the reason for that?" Christian asked.

To which Luft replied, “That’s something that we can work on together.”

Photo -- Administrative intern Lindsey Luft speaking at tonight's City Council meeting.

The city continues to be dogged by vacant, abandoned and unkempt residential properties, prompting a City Council conversation Tuesday night about the city's progress on a few specific nuisance properties.

City Manager Jason Molino said the city's effort to deal with so-called zombie houses is making progress, but it's a "slow-moving train."

"Some of the vacant homes that were vacant are no longer vacant," Molino said. "They’ve been picked up and worked on, so we're seeing some progress."

Three properties, in particular, were singled out by council members -- 129 Hutchins St., 404 S. Jackson St., and a house on Ellicott Avenue.

The house on Hutchins fits the description for what officials usually mean by a "zombie property." It's long been vacant and there's little indication that anybody is taking responsibility for it.

There's junk piled on the front porch and scattered around the back yard, and the grass hasn't been cut all season. Inspectors have posted a notice on the front door.

Councilwoman Rose Mary Christian has determined the USDA, which apparently financed the purchase the property, has possibly foreclosed on the house and she's been in contact with USDA officials about cleaning up the property.

At 404 South Jackson, across from Jackson School, is the burned out hulk of a former multifamily complex. The building was destroyed in a fire March 8 and has sat untouched since, except for a safety fence the city erected around it.

Molino said the owners, Barton H. Bowman and Thomas W. Hallock, have been cited and were ordered to appear in court earlier this month, but neither showed up in City Court, so a warrant has been issued for both men.

Through the normal court process, it could take 30 to 90 days to get the structure torn down, Molino said. If the city wants razed sooner, like immediately, the city could do that, but would have to foot the bill.

As for the property on Ellicott Avenue, Councilman Bob Bialkowski raised it as a possible zombie property. A check of the residence led to the discovery of an open door with possible forced entry. When police responded, there was nobody inside and dispatchers were able to contact the property owner, who indicated she is in the process of moving out. There was no forced entry, a police officer said. The broken glass near the door was from damage the property owner knew about.

The city has a tax exemption available for owner-occupants who buy a zombie property and rehabilitate it. While there have been several inquiries about the exemption, and several former zombie houses are now owned and occupied, no exemptions have been granted yet, Molino said. That could soon change.

Molino said a young couple recently purchased a house that had been vacant for at least seven years, getting it on a short sale, and the couple plans to invest a significant amount of money rehabilitating it. Molino said he is meeting with the couple next week to discuss the exemption.

"This definitely qualifies," Molino said. "This might be our first actual case."

The city is also working with potential community partners on a loan program to help people finance the purchase of owner-occupied former zombie homes. He said an announcement about that program could come within 30 to 60 days.

A new state law that goes into effect today is another tool for communities in their efforts to crack down on the number of bank-foreclosed (“zombie”) homes in New York, according to Batavia’s city manager.

“While the local law that we passed deals with development of these types of homes, this state law is more about monitoring (the banks that have interest in abandoned properties),” Jason Molino said this morning. “It’s a good tool, but it will take time for things to filter out to see the impact.”

The Foreclosure Relief Act is a new law that requires banks or mortgage lenders to maintain properties that have become vacant during the foreclosure period, and also requires that periodic inspections be made. Failure to comply with the law could result in fines up to $500 per day.

The law also includes a toll-free hotline for people to report zombie properties and a statewide registry to track them.

“Once rules are put in place by the state agencies involved, we will have a better understanding of the accountability piece,” Molino said. “The goal is to prevent foreclosures from happening and also as a tracking and enforcement tool to prevent lenders from letting the properties go under water.”

The push to get the law passed in Albany was led by South Buffalo Assemblyman Michael Kearns, who promoted a “shame the banks” campaign.

Prior to this law, it was up to cities and counties to fight the banks that created the zombie homes, usually through fines against the property owners for building code violations. But since banks aren’t taking legal control of the houses, they have been able to avoid paying additional fines or fees.

Under the Foreclosure Relief Act, the state Department of Financial Services – which issues the banks’ state licenses – also has enforcement authority.

To report zombie properties, contact New York's Department of Financial Services at (800) 342-3736.   

About a year and a half ago, City Council passed a local law that provides incentives to owners of highly distressed properties willing to spend the time and money to renovate their homes.

Council acted on a gap financing plan devised by Molino (with assistance from the New York Conference of Mayors) that offers exemptions for up to 25 years on the increase in the property’s assessed value after redevelopment.

Pat O'Brien was a little surprised, but not shocked to learn yesterday that the house on Ross Street that he moved into Monday was the subject of a $841,500 fine by Batavia City Court for a long string of alleged code violations.

Before O'Brien bought the home, the city determined the responsible party for the property was HSBC Bank. The bank was allegedly issued a summons to appear in court to answer to the code violation charges, but reportedly, no representative of HSBC ever appeared.

When defendants fail to appear in court as directed, judges have the discretion to find the party guilty and after another demand to appear in court, in the defendant's absence, the judge can issue a sentence.

That's what Justice Durin Rogers did Friday against HSBC and another entity responsible for a local property that has allegedly failed to appear on the matter.

That defendant is Kaja Holdings 2, LLC, held responsible for 21 Hutchins St., Batavia. Kaja was found guilty in absentia of 1,092 violations of the city's property maintenance code.

HSBC was found guilty of 3,336 violations.

Rob Sherman, corporate communications for HSBC, did not respond to a voicemail left yesterday requesting comment.

Kaja Holdings did not respond to a request for comment. 

City Manager Jason Molino said the judgments against HSBC and Kaja are part of the city's ongoing, aggressive efforts to deal with so-called "zombie" homes -- homes that have been left abandoned and vacant for extended periods of time following a foreclosure.

"We going to push aggressively with non-responsive individuals with an interest in properties in hopes of getting people's attention and start getting them to respond," Molino said.

Molino said the city was only notified on Monday that the Ross Street property had been transferred to the new owners.

"We're pleased with the outcome," Molino said. "It's exactly what we like to see."

Whether HSBC will still be on the hook for the $841,500 fine, Molino said he didn't know. That will be up to Justice Rogers to decide.

As for Pat O'Brien, he said he's thrilled with the house and happy to become a Batavia resident.

He took a job in Henrietta in the fall and found the house on the house listed for sale on the Fannie Mae Web site. He worked with local real estate agent Chuck Flynn to complete the purchase.

He's had a new gas line installed (it was cut off at the street), new electrical installed and the city turned the water on two days ago, making the house livable once again.

"Even though it looks a little bit bad on the outside, surprisingly, it's not that bad on the inside," O'Brien said. "Structurally it's really sound."

O'Brien said he liked Batavia because it's a small, quaint community that seems to have a lot going for it. Workers who have come over to his house have had good things to say about Batavia, he said, that it's a community on the rise.

And commuting to Henrietta, he said, is no big deal.

"Back in Jersey, I actually had a longer commute, so the commute between Batavia and Henrietta doesn't bother me," he said. "It's all Thruway. It's under 45 minutes, which I don't think is that bad."

Molino said O'Brien will be given time to get the house in good shape once again, which O'Brien said he intends to do.

"If you look at the house, it's actually not as bad as you think because the top third has all been aluminum sided and so I only have to repaint the lower two-thirds of the home, so like I said, I think by the end of the summer it should be a gem on the street," O'Brien said.

Our news partner WBTA AM/FM contributed to this story.

21 Hutchins St., which is vacant and condemned.

Statement from Assemblyman Steve Hawley (R,C,I-Batavia):

“I am proud to announce that Gov. Cuomo today signed into law legislation that will provide a property-tax exemption for residents who purchase and renovate dilapidated homes and zombie properties," Assemblyman Steve Hawley said. "This ensures that renovation costs do not exceed property values for homeowners and provide an incentive for residents to purchase these abandoned properties and revitalize our communities.

"This is a revolutionary program that has the potential to work in other cities and is the first of its kind in Batavia. Zombie properties have plagued our city for several years dating back to the housing collapse of 2007. This law will increase the number of properties on the tax rolls, thereby reducing our tax burden and increasing property values.

"My colleagues and I in the Assembly and Senate worked diligently at the end of session to pass this bill through both houses and I applaud the governor’s efforts to make this bill a reality for Batavia.”