BlightStat 33

by Charlie London

If you live next to a blighted building or an overgrown lot in New Orleans your perception of the fight against blight may not be positive.

But, when you consider that the City of New Orleans’ BlightStat program has received acclaim both nationally and internationally, that may mitigate your frustration a bit.

And, when you consider that Chicago and Philadelphia with tax bases and therefore resources exponentially larger than New Orleans have the same problems curbing blight that may help your mood as well. Chicago, Philadelphia and other cities both large and small are looking to the City of New Orleans in the fight against blight. The City of New Orleans’ perspicacity and initiatives have positioned our city as the clear leader in the fight against blight.

However, if your neighborhood is still suffering from the effects of Hurricane Katrina with blighted housing and overgrown lots in abundance, all those accolades are meaningless. You just want the problem to go away.

I’ve been to all 33 BlightStat meetings since November, 2010 and I can tell you without a shadow of a doubt that the people at the table in these BlightStat meetings are passionate and purposeful in their desire to have New Orleans continue to grow, prosper and be blight-free.

So, what’s the hold up then? Here’s what I have observed:
There does not appear to be any problem getting properties inspected. In fact, the inspectors have all been assigned to specific districts within the city and are even more efficient than before. Inspections are not the problem.

Cases are being adjudicated as fast as they come in but resets and guilty with conditions have slowed the process somewhat. The City is moving toward more straight out guilty judgments which is reasonable considering owners of blighted property have had 7 years to get their act together. The adjudication process is part of the problem because case management has struggled to keep up with the volume of material coming in from inspectors, and older inspections get stale (hence the reinspections).

We have a team of 2 highly competent, motivated and passionate lawyers that are dedicated to finding heirs to dead owners and previous owners that won’t pay taxes or do anything with their property. That takes time. You would be amazed at just how much time that takes. Of those 4 lawyers, Ms. Brenda Breaux is the boss. Ms. Breaux mentioned during the meeting that there are only 2 lawyers working on filing writs for code lien foreclosure process (Mr. Tyler Gray & Mr. Miles Granderson). Ms. Breaux has a bunch of other responsibilities that do not involve actual writs, in addition to managing her team (like working on the constitutionality of the foreclosure process as a whole), and Ms.Tammie Jackson is Deputy Director for case managment.

THERE ARE ONLY 2, yes I said 2 lawyers to do the actual research on thousands of cases.

The goal of these 2 dedicated lawyers is to get 65 cases completely researched and ready for adjudication each month. I dare say a highly staffed private firm would have trouble doing the same considering the amount of research and fact checking that is required to produce a writ.

So, what’s the answer you ask? You, my friend are the answer. If you can help enter information or are a paralegal that can volunteer a few hours each week your service would go a long way toward moving our city forward. At 65 cases each month, we’ll all be dead and gone before the thousands of properties that need it get adjudicated.

So, what’s it going to be? Are you going to be that bitter resident that sits around and grumbles that nothing is happening with blight in your neighborhood? Or, are you going to be that person that gets off the sofa and does something about it? I suggest the latter option will make you a much happier citizen.

“But, that’s what I pay taxes for”, you say. That’s right. But, the problem is we have a city built for 600,000 people but only have a population of 343,000. Of that 343,000 only a comparatively small percentage pay property taxes. That is the real problem. There just isn’t enough money to make the things you want to happen… happen. I strongly urge you to consider helping the city help you. Call the city’s law department at 658-9800 to find out how you can help the city help you.

This was the 33rd BlightStat meeting to which the public was invited.

It is clear that enforcement of laws related to blighted properties will be more aggressive in 2012. The Mayor’s directive to have 10,000 blighted properties eradicated in three years remains on track.

BlightStat 34 will be held on May 10, 2012. The meetings are on the 8th floor of City Hall in the Homeland Security Conference Room.

Below are notes from the April 12, 2011 BlightStat meeting:

Ms. Pura Bascos and Ms. Kristin Illarmo both noted that the city is allowing fewer conditional guilty judgements at the blight adjudication hearings. This is a clear message to blighted property owners that the city has given them plenty of time to get their act together. After 7 years, the city like its residents, is tired of the excuses. Fix your property or sell your property. Don’t like those options? Then the city will take action to protect their interests.

Ms. Illarmo noted that during the recent adjudication hearings:
5% were reset for no inspection.
25% were reset for work-in-progress.
22% of the blighted property owners made their property compliant.
These results are similar to previous reports and indicate steady progress.

Mr. Andy Kopplin noted that the city is taking a tougher stance as we get further from the Katrina event.

Mr. Oliver Wise noted that the reports were grouped by initial inspection. He then reviewed the “Status of Properties” slide. He also noted that there appears to be a significant lag between the time the properties are first inspected and when the property goes to adjudication.

Mr. Wise also mentioned that the trend appears to be that 20% of the blighted property owners will bring their properties into compliance rather than face adjudication.

Ms. Bascos indicated that many properties make it through the NCDC (city) but the demolitions are then denied by SHPO (state). Ms. Bascos indicated that SHPO denials are a barrier to progress.

Ms. Hillarie Carrere said that SHPO has jurisdiction over all properties in New Orleans not just those in historic districts.

Ms. Bascos said that 30 FEMA demolitions took place last month. Inspectors were assigned to specific districts several months ago and that process seems to be helping make the department more efficient.

Mr. Kopplin noted that FEMA had a banner month with demolitions.

6840 Cindy place was noted as a major demolition case as it has multiple units. Mr. Will McGowan said that 33 units were brought into compliance last month. 30 more units had to be demolished (69 units total) and 15 structures were salvaged.

Mr. Keith Ferrouillet with the Interim Nuisance Abatement Program (INAP) said 26 properties were cut and 6 more were in compliance. A new contract with INAP will be in effect soon just in time for the summer growing season.

Mr. Miles Granderson said 50 of the 65 files reviewed were accepted for foreclosure.

Mr. Jeff Hebert noted that previously, properties with buildings on them were a priority. Now vacant lots will be an action item.

Mr. Wise inquired as to why there were so many more files accepted for foreclosure this month. Mr. Granderson replied that these cases were all better cases from 2011 and that more effort is being put into the pre-filing stage.

The Law Department appears to be efficient and diligent in their fight against blight. But, with only 2 lawyers to get cases ready for blight court, the situation could be compared to 2 knights swinging swords at the bottom of a well. They may eventually get to the top but it’s going to take a long long time.

Ms. Tammy Jackson said that information from data.nola.gov is slow to get to civilsheriff.com

Ms. Breaux mentioned that there are only 2 lawyers working on filing writs for code lien foreclosure process (Mr. Tyler Gray & Mr. Miles Granderson).The New Orleans Bar Association has been contacted for lawyers willing to perform pro bono work. Big law firms have been contacted to see if they would be willing to provide a paralegal to help. The Board of Ethics approved the city’s request to ask the public for help. Ms. Brenda Breaux plainly stated that the 2 lawyers working on research are simply overloaded with cases to work on.

Mr. David Lessinger with NORA indicated that a steady consistent stream of information is the goal.

Mr. Jeff Hebert, Director of NORA, indicated that “noticing” issues are the biggest problem nationwide. “Noticing” means notifying the owners or heir of owners that the city is about to take action on their property.

Mr. Wise noted that when the lawyers refer to the “mennonite case” they are referring to Mennonite Board of Missions vs. Adams. A summary of that case is below:
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Summary of Mennonite Board of Missions v. Adams,
462 U.S. 791 (1983).
Facts

Alfred Jean Moore had executed a mortgage in favor of the Mennonite Board of Missions (P) to secure an obligation. Moore had purchased land from the Mennonite Board of Missions and was responsible for paying taxes. The Board was not aware that Moore had failed to pay taxes. The county moved to sell the property for lack of tax payment.

The county provided proper service according to state law. Notice was posted in the courthouse, the state published an announcement, and sent Moore a certified letter. The Board was not otherwise informed of the county’s efforts to sell the property. The land was later sold to Adams (D). Neither Moore nor the Board attended the sale. Moore continued to pay her obligation to the Board which remained unaware that the land had been sold.
Procedural History

Adams filed for quiet title and summary judgment. The Board contended that it still held title to the land because the tax sale was invalid due to inadequate service of process. The trial court found in favor of Adams and upheld the tax sale statute against the service challenge. Judgment in favor of Adams was affirmed on appeal to the court of appeals and the Supreme Court granted certiorari.
Issue

Is notice by publication and posting sufficient to provide a mortgagee of real property with adequate notice of a proceeding to sell the mortgaged property for nonpayment of taxes?

Holding and Rule (Marshall)

No. A mortgagee whose mortgage would be divested by a tax sale is entitled to personal service of notice of sale by virtue of the Due Process Clause of the Fourteenth Amendment.

The constitution demands that a party receive notice through mail or other means that will ensure actual notice of a proceeding which will adversely affect the interests of any party, provided it is reasonably possible to ascertain the party’s name and address.

The Supreme Court in Mullane v. Central Hanover Bank & Trust Co. held that due process demands that notice must be reasonably calculated to inform interested parties of the pendency of the action and afford an opportunity to present their objections. A mortgagee has a protected property interest and is entitled to notice that is reasonably calculated to apprise of a pending tax sale.

Unless a mortgagee is not reasonably identifiable constructive notice alone is not sufficient. Constructive notice is primarily designed to attract prospective buyers and is unlikely to reach those who do not make special efforts to seek tax sales. Notice to a the property owner who is not in privity with creditors and who has failed to retain the property cannot be surmised provide actual notice to the mortgagee. The use of less reliable forms of notice is not sufficient when an inexpensive and efficient means such as mail is available.
Disposition

Judgment reversed.
Dissent (O’Connor)

Process needs to be tailored to a given situation and circumstances. With the majority holding in this case, the court has set a low-bar standard for process. Notice by mail or other means to establish certain notice is a now a minimum constitutional requirement for any legally protected property interest.

The majority is rejecting earlier cases in which this Court acknowledged the impossibility of establishing a rigid formula as to the kind of notice that must be given, and that “notice will vary with the circumstances and conditions”. Policy considerations of the state override those of process. Due process does not require that the State save a party from its own lack of care when it has acted unreasonably in failing to protect its interests.
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Mr. Kopplin noted that Chicago and Philadelphia also have significant blight problems. They are much bigger cities but are looking to New Orleans for clues on how to fight blight.

Mr. Lessinger said the city is going to get access to current satellite imagery to better assess properties that may look great from the front but the back of the property is falling down.

Mr. Lessinger noted that homes sold to the Road Home program are transferred to the Louisiana Land Trust and then to the City of New Orleans. There are 5,000 properties with Option 2 or Option 3 in the Road Home program.

Mr. Lessinger further stated that the largest number of properties are disposed of through the lot-next-door program. The Louisiana Land Trust is working with the New Orleans Redevelopment Authority to get properties closed out.

Mr. Brian Lawlor (Office of Community Development) said that an announcement will be made soon about the availability of 7 or 8 million dollars for rehabilitation and renewal of rental properties. The soft-second program is very successful. Mr. Lawler said to look for an announcement about the “SUPERNOVA” program soon.

Mr. Kopplin said the overall goal is to get people to do what they are supposed to do.

Mr. Hebert answered my question about Federal Government involvement (other that FEMA). He indicated that the Federal department of Housing and Urban Development has helped fund the blight eradication process and that the Justice Department is here helping because blight contributes to crime.

The meeting adjourned.