Columbus Dispatch Interviews Frank S. Alexander about Home Foreclosures in Ohio

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By Geoff Dutton

Taxes will be paid on every property in Franklin County, even the abandoned, ramshackle houses.


But the government's methods of squeezing property taxes from the growing number of vacant houses, and rousting neglectful owners, can be excruciatingly slow for neighbors.

"Vacant properties are like a pollutant, like a toxin to everything around them," said Jason Reece, who has researched the problem at Ohio State University's Kirwan Institute for the Study of Race and Ethnicity.

Franklin County's annual tax squeeze began last week with the publication of 9,662 properties whose owners are behind on taxes, 20 percent more than last year.

Total owed: $14.2 million.

The owners of most of the properties will pay in the next year, but some will delay for years and trigger legal action.

A proposed change to state law, introduced in June, would make it faster and easier for counties to foreclose on abandoned houses with delinquent taxes. The process, which typically takes two to three years, would be shortened to about six months.

After foreclosing, the city or county either could develop the properties or deed them to nonprofit community groups that fix old houses.

"The time to foreclose is very lengthy, and this is a way to expedite it," said state Rep. Sally Conway Kilbane, a suburban Cleveland Republican sponsoring the bill. She predicted swift approval early next year.

City and county officials are pushing for change as record numbers of people in Ohio are falling behind on mortgage payments and losing their houses to banks and lenders. With those cases clogging the courts, officials say, government foreclosures for unpaid taxes also have piled up.

Frank Alexander, a leading foreclosure expert and interim law school dean at Emory University in Atlanta, identified tax foreclosure reform as "the single most important thing for Ohio to address."

He spoke at a vacant-property conference in Columbus last month that was attended by more than 250 officials from across the state.

Kilbane's bill would speed tax foreclosures by bypassing court and authorizing counties to handle tax-delinquent, abandoned houses administratively. The change would be optional so that county officials could continue to route cases through court if they prefer.

But local officials see it as an opportunity. Franklin County Treasurer Richard Cordray said it would "without question" help cities and counties attack the worst and most difficult tax-delinquent properties.

"It is essential that these select properties be foreclosed on and returned to productive use," Cordray wrote in a letter to Kilbane.

Now, that can take years.

After publishing a list of taxdelinquent properties, the county will send several more notices in the next year. Most of the tax liens that remain unpaid then will be sold to investors, who take up debt collection and make money by charging the property owners interest and, if necessary, foreclosing.

But properties with more tax debt than they are worth, or blighted properties of particular concern to local officials, are foreclosed on in court. Government officials put those in "land banks," for redevelopment, or deed them to community housing groups.

"Throughout the city, there would be a number of nonprofits interested," said Gary Davisson, of Community Housing Development, a group that rehabilitates vacant South Side houses.

Cordray estimates that fasttracked tax foreclosure would affect several hundred cases a year in Franklin County. Cuyahoga County Treasurer Jim Rokakis, who is leading the push, said a backlog of several thousand tax-foreclosure cases in Cleveland could be relieved.

About half of the states allow for at least some foreclosures to be handled outside the courtroom, and the Ohio State Bar Association has backed away from its initial misgivings about Kilbane's bill.

Gus Frangos, a Cleveland realestate lawyer who also works for Rokakis, helped draft the bill. Some states handle all foreclosures administratively, he said, while Ohio requires all to go to court.

Kilbane's bill would make exceptions only for abandoned houses that are at least two years behind on taxes.

"Ours is a blend," he said of the bill. "It?s the best elements of both."


The Columbus Dispatch

Counties back proposal to speed tax foreclosure

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