A steady rise in housing prices nationwide has made analysts and investors hopeful about the future of the U.S. housing market overall. But in Michigan, one of the states most battered by the financial downturn, officials are still grappling with the grim remains of years of unemployment, population loss, and plunging property values.
Those remains are not figurative. They can be seen in the form of abandoned houses — tens of thousands of them — in neighborhoods around the state. Detroit alone has more than 30,000 such buildings.
That’s why the Michigan State Housing Development Authority has been seeking permission to use federal funds aimed at keeping people in their homes to instead tear down derelict structures where no one will ever live again, and which often attract drug dealers, prostitutes, or arsonists.
Michigan’s leaders argued that demolition was the sensible place to start.
Yesterday, the feds finally agreed. Treasury officials released $100 million in money from the Troubled Asset Recovery Program, or TARP, to pay for a pilot demolition program in five Michigan cities: Detroit, Flint, Grand Rapids, Pontiac, and Saginaw.
So let’s see if we get this right….
1. These buildings are private property owned by banks or other investment groups.
2. They cannot be sold and they simply sit there losing value.
3. Some of those private buildings are used by the homeless or criminals and those private owners of those buildings do not pay for security to protect them.
4. The property owner’s solution is to get their Congressman to send a letter to TARP to use money (earmarked to keep people in their homes) as funds to destroy private property that is losing value.
Not a scam you say? Well, read this….
“U.S. Representative Daniel Kildee, a Democrat from Flint, argued his state’s case in a March letter to Treasury Secretary Jack Lew [PDF], whose department administers the Hardest Hit fund. He cited research showing that in Flint, where 12 percent of the housing stock sits empty, that sale prices for occupied homes go down by 2.27 percent for each abandoned structure nearby. Kildee was the co-founder of the Center for Community Progress, a national organization that advises cities around the nation on how to reverse blight, and he also co-founded Michigan’s Genesee County Land Bank, which buys up and develops vacant and foreclosed properties in the area that includes Flint.”
Oh, gosh…the man who co-founded a Land Bank that buys up and develops vacant and foreclosed properties wants to use federal funds to tear the damn buildings down and save some money while he waits to re-sell them. Let me see…he saves money on demolition, he saves money on insurance of undeveloped properties, and he saves the new buyers the cost of any demolition also.
What a Congressman!
He is in on the deal! ( That may not be true although I infer it.) And because he is a Democrat, he gets the Administration to do what he wants….and wasn’t he clever to get the State of Michigan’s Housing Development to push for this in the Federal government. It is truly Orwellian when the State Housing Development is used to get money to destroy homes that were foreclosed upon. How many of those homes could have had residents living in them if they were purchased or paid by the government instead of foreclosed upon?
And, of course, this is all done during sequestration….
This is why you, dear reader, need to elect reasonable people to Congress instead of Republicans and Democrats.
Update: I removed some of my emotion from this post. I got a little carried away. Maybe next time, the cities of Michigan can sue the property owner, foreclose on the land, take ownership, put people to work tearing them down or boarding them up. Sheesh. Does everything require going to the Federal government for money to support some company, some developer, or some other initiative?