Distressed Property in Worcester: The Problems and The Options - April 11, 1997

EXECUTIVE SUMMARY

Worcester, like most older cities, has abandoned buildings, neglected property and vacant lots which are having an adverse social and economic impact on a number of neighborhoods. These properties are targets for arson, drugs and trash. After reviewing how the distressed-property problem is addressed in Worcester and several other cities, the Research Bureau makes a number of recommendations (see recommendations section for further elaboration):

• The City should establish an overall neighborhood and community development agenda. This should include, for example, a plan for managing and disposing of the City's inventory of vacant lots and abandoned buildings.
  
  
• The City should utilize fully the resources available for helping cities to implement a community development agenda. These include grants from local and national foundations, and loans from banks and insurance companies to leverage the City's limited resources.

• The Office of Planning and Community Development (OPCD) should continue to work with neighborhood and community development organizations to prepare comprehensive plans for each neighborhood. These plans should include use of eminent domain powers where appropriate for neighborhood revitalization.

• The City should contract with a consulting firm with planning, urban design, traffic, land use, housing, and economic development expertise to implement these neighborhood plans.

• The City should develop an integrated land records database. An accurate and comprehensive inventory of property-based information that can be shared by public agencies and authorities is necessary for planning and land management purposes. In order to achieve this goal, the Geographic Information System (GIS) program needs additional staff.

• The inter-agency task force that has been meeting for the past several months to develop policies related to foreclosure and disposition of distressed properties should be converted into a permanent neighborhood development cabinet. It should be modeled after the successful economic development cabinet created by the City's Chief Development Officer.

• The City Manager should utilize the provisions of Massachusetts General Laws (M.G.L.), Chapter 58, Section 8. Under this statute, he can request the Commissioner of Revenue to authorize the City's assessor to grant abatements for abandoned residential property of six units or less that are proposed to be rehabilitated into six units or less.

• The City should review the assessment of property in low-income neighborhoods to determine whether it is over-assessed compared to more expensive housing. If it is, property taxes should be reduced accordingly, since the property tax assessment rate has a large and significant effect on abandonment rates.

• The City should design incentives that encourage property owners to pay their delinquent taxes before their properties enter the foreclosure process. These include a high visibility ad campaign that publicizes names and amount owed by the worst offenders, and denial of various licenses and permits for individuals who are delinquent on their property taxes.

• The City should provide landlord training seminars on a regular basis.

• The City should avail itself of the M.G.L., Chapter 139, the law allowing prosecution of owners/landlords.

• The City should continue to use receivership as a tool for dealing with housing that has serious code violations.

• To prevent the loss of viable properties to demolition, the City should develop procedures to identify and re-use recently vacated residential properties before they are vandalized or suffer serious damage. A direct reporting system, such as a telephone hot line, needs to be developed to allow individuals and community groups to inform the City about newly vacated properties.

• The City Council should approve a demolition delay ordinance for historic buildings.

• The City should adopt an abutter lot program similar to the one used in Boston.

• The City should develop a community-based "Land Stewardship Demonstration Program" for vacant-land maintenance. The City should work with various community groups to develop a target demonstration program for the long-term maintenance of vacant land, modeled on community land trusts. The objectives of land trusts are to acquire, hold and maintain land for community benefit.
  I. INTRODUCTION

  Every city has abandoned, neglected property and vacant lots which once contained structures. Planners and researchers call them TOADS (Temporarily Obsolete Abandoned Derelict Sites). They are scattered, unused parcels of land of varying size and shape. Some contain abandoned structures; others are only empty lots. They are no longer used productively, or they never were. Often they have been damaged by previous industrial or commercial use, or by proximity to such uses. In general, research on abandonment of buildings has been concentrated on identifying the causes of housing abandonment, the economic consequences, and strategies for reclamation. According to Greenberg, Popper, and West, three Rutgers University researchers, there has been little focus on the possible social consequences of building abandonment, although there have been some exceptions.¹ A study of abandonment in Newark concluded that it was more the result of owner-tenant disputes and neighborhood change than of the physical characteristics of the building themselves.²

  In 1990, Greenberg, et al. conducted a survey of the fifteen largest cities to determine, among other information, the most serious types of problems attributable to abandoned and derelict sites.³ While economic issues such as costs to a city in terms of lost revenue, cost of cleanups, maintenance, demolition, and rehabilitation were important to one-third to one-half