City policy removes blight, strengthens neighborhoods

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Sunday, October 17, 2010
— Hawthorne Avenue neighbors are pleased with a new city initiative that buys tax-delinquent properties cheaply with a goal of removing blight and maintaining owner-occupied homes.

"I'm glad to see it fixed up," said Shirley Hazeltine of 1326 Hawthorne Ave.

She is a neighbor of tax-delinquent home at 1332 Hawthorne Ave., which the city council on Monday voted to buy.

"Anything to improve and keep the neighborhood good is what I'm for," said Ann Pedersen, 1327 Hawthorne Ave.

Janesville is getting more aggressive in acquiring homes and vacant lots in an attempt to reduce blight, retain owner-occupied homes and stabilize neighborhoods.

The city recently started borrowing for blight elimination and in 2011 will have $500,000 available.

Buying tax-delinquent homes is "something we'll look at every year and evaluate against our neighborhood improvement effort to see if (it) makes sense for us to be involved," said Jennifer Petruzzello, neighborhood services director.

'A more active role'

The city will pay $13,925 to buy the home at 1332 Hawthorne Ave. The price includes delinquent taxes since 2006, interest and closing costs. State law requires that the county offer the city the chance to buy the home before it goes up for auction.

The 1,575-square-foot home was built in about 1949. Its estimated fair market value is $111,319, and the city's real estate agent has said the house could list for $110,000 to $115,000, Petruzzello said.

The city will spend about $50,000 to put on a new roof and do other rehab work. The home then will be sold with a restriction on its deed requiring it to remain owner-occupied. Any profits will be used to purchase other blighted properties.

Janesville for the first time last year bought three tax-delinquent properties in the central city area. One of those homes has been demolished, and a second is scheduled to be torn down. The city is seeking private bids for the third to see if anyone is interested in rehabbing it.

The Hawthorne area, while not in the inner city, is in the neighborhood services target area because of its older housing stock, Petruzzello said.

The city buys such properties because it then has control over them, Petruzzello said. The practice helps stabilize surrounding property values and ensures the homes remain owner-occupied. The city can decide whether to rehab the home to a decent and safe standard or demolish it if it cannot be saved.

Last year, Petruzzello said she was shocked to find people living in the tax-delinquent dwellings the city purchased last year.

"That makes the case for city government to become involved and make sure people have a safe place to live," she said.

"I think that the city has taken a more active role in rehabbing homes that the private sector hasn't been interested in."

Beloit's experience

Beloit started a similar program seven years ago, buying tax-delinquent homes anywhere in town.

Beloit City Manager Larry Arft said the city wants to control the destiny of the properties.

"We view it as protecting the quality of the residential neighborhoods and protecting the residents who live in those neighborhoods," he said.

Such houses otherwise can go cheaply at auction and become part of a landlord's rental portfolio, Arft said.

Beloit buys an average of two homes a year and available vacant lots. This year, Beloit will buy eight homes and has run out of money to buy lots.

Beloit budgets $150,000 to $200,000 a year for blight elimination.

Decent homes are rehabbed and sold. Any profit is put back into the blight elimination fund. Many of the homes are at the end of their lives, which is one reason people stop paying taxes, Arft said.

Vacant lots are sold to neighbors to increase the size of their lots. The practice gets the property back on the tax rolls and assures that it is maintained, he said.

Leaving tax delinquent properties to the private marketplace hasn't worked well, Arft said.

"We need to get control of those delinquent properties and make sure they're dealt with in a positive way."

Last updated: 3:12 pm Thursday, December 13, 2012

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