Attacking Foreclosures Differently

Lowell Sun Editorial
March 10, 2011

It’s obvious that Lowell needs a strategy to get foreclosed properties back to becoming productive homes.

Sitting back and waiting for the economy to improve, or battling big banks in court for fees and penalties is not being proactive.

Over the past six months, City Councilors Franky Descoteaux and Patrick Murphy have floated ideas that would incentivize the purchase of foreclosed properties.

In August, Descoteaux asked the city to explore launching a program in which it would waive fees and permits for owner-occupants who rehabilitate blighted properties. With the cost of construction permits and other fees having increased dramatically in the city since 2006, Descoteaux’s proposal showed potential. In the present climate, a savings of $1,000 or more could turn out to be a deal maker.

In November, Murphy filed a motion to explore offering tax reductions to those who purchase foreclosed properties and agree to fix them up. Only owner-occupants — and not developers — would be aided under Murphy’s proposal.

Both Descoteaux and Murphy feel that programs can be developed to target neighborhoods where foreclosures are numerous and are negatively impacting property values of occupied homes.
“These incentives,” said Murphy, “are another way to come at the problem.”

It’s a credit to Descoteaux and Murphy for thinking out of the box. Lowell now has more than 600 foreclosed properties throughout the city. The longer they stay vacant, the quicker they deteriorate and drag down the neighborhood.

Unfortunately, research by the city’s Department of Planning and Development have yielded frustrating results. There are a number of incentive programs for developers but none benefiting individual property owners. Also, state law and the Department of Revenue prevent the city from offering tax abatements to residential property owners in return for them fixing up their homes.

Still, as Assistant City Manager Adam Baacke points out, the city can seek relief through new legislation or a home-rule petition.

These ideas should not go to waste. As Councilor Murphy points out, all Gateway cities with high foreclosure rates can benefit from these proposals.

We urge the City Council to take these ideas to the next level. They should request Lowell’s Statehouse delegation to craft a bill incorporating these incentives into a new homeowner program. Lowell and all other cities could use another weapon in the arsenal to reverse the foreclosure trend.

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