Sunday, September 21, 2008

Difficulties in Rehabilitation of Abandoned Property

When examined together with other actions taken by the City, some of the closures placed the original and legal property owners in a difficult position. Reopening the properties required them to obtain costly permits for repairs and navigate a maze of city inspections and municipal law conducted at the property owners' expense. Because the state had evicted the plaintiffs' tenants, the plaintiffs had essentially no revenue from the rental properties to fund repairs, and many owed so much money in mortgages that they could not qualify for federal rehabilitation loans, which have certain minimum requirements for an equity interest.

Several plaintiffs had alleged that the state, to force them out of business or into line with the state's plan to rid the area of destitute and unwanted tenants, deliberately withheld financing to hinder the plaintiffs' repair making efforts. The state also sued property owners and shut off electricity and water to the structures. With the area left largely abandoned, vagrancy and criminal activity became a serious problem. Departing tenant defendants left their apartments in disarray in retaliation for being moved. Property owners attempting to bring their buildings to a level that satisfied the legal code often found their repairs ruined by vandals before city inspectors were able to certify the properties.