At last Tuesday’s Finance Committee meeting, Robert Purtell, member of the Amsterdam Land Bank Advisory board, introduced the prospect of transferring a foreclosed, abandoned home on Brookside Avenue to the land bank so that they can rehabilitate it, sell it, and return it to the tax rolls.
Purtell said that his purpose in bringing the idea before the common council was to begin a discussion, and was not asking for immediate action.
“It’s the worst house in a pretty good neighborhood that’s stabilizing,” said Purtell about the property.
According to Purtell, the property (now held by American Tax Funding), is worth approximately $30,000 in it’s current condition, but has about $40,000 in back taxes associated with it.
“No one will buy it because it doesn’t make sense,” said Purtell, “So by [the city] taking a deed in lieu of foreclosure from American Tax Funding…we can clear up those back taxes, and then move it from there into the land bank.”
“Why don’t we do an auction bid on it and then if that doesn’t work then go back to the land bank?” asked 3rd Ward Alderman Ron Barone.
“That’s a good question,” answered Purtell. “By going to auction you’re rolling the dice in who you’re going to get to do it…someone can afford that property but there’s no promise that they’re going to rehab it to a condition that’s going to bring up the property values in the neighborhood.”
“That’s why you would put a contingency in there – within 6 months they have to come up to full code. Or guess what, it comes back to the city,” said Barone.
“In the past the city has done that…there was never really any teeth for the city to enforce that,” answered Purtell.
He went on to explain that most investors looking to “flip” a property will only put in the minimal amount of repairs necessary to maximize their profit when selling it, and would not be concerned who they sold the property to. Being that the land bank’s mission is to improve the neighborhood, their goal would be to “overbuild” the property in order to bring up property values.
“I think we can do a much better job for you to stabilize the values in that neighborhood,” said Purtell.
He also added that if the land bank sold the property, the profit would be used for future renovation projects.
“I totally agree with you,” said 1st Ward Alderman Ed Russo. “I understand it’s going to take a little bit more time to do this but I think it’s the right way to go…like you said, if you put it up for auction, even if you have strong codes [enforcement] you’re still going to have issues… alright the person has 60 days to fix it up. Well he doesn’t do it, now it comes back to the city, then you’re talking about longer times.”
“We have had so many slumlords come in and buy these properties at auction and they don’t bring them up to code,” said 4th Ward Alderwoman Diane Hatzenbuhler. “Then codes is out there on a daily basis knocking on doors trying to get them to bring them up. I kind of like where we’re going and knowing that [the properties] are going to be brought up to code by legitimate contractors.”
Purtell said he was looking for a consensus from the common council on the idea before he went any further in discussions with American Tax Funding. Hatzenbuhler took an informal poll of all the council members, all of which indicated they had no problem with the idea.
Purtell thanked the council and said that he would move forward with his discussions and gave an assurance that he would not finalize anything without the council’s formal consent.