Richmond, CA first to jump into eminent domain battle

[Jesus Malverde]

Last edited Tue Jul 30, 2013, 07:04 PM - Edit history (1)

Taking a controversial plunge into uncharted waters, Richmond is poised to become the first city in the country to invoke eminent domain to address its foreclosure crisis.

"After years of waiting on the banks to offer up a more comprehensive fix or the federal government, we're stepping into the void to make it happen ourselves," Mayor Gayle McLaughlin said in a conference call Tuesday.

On Monday the city sent letters to 32 investors - largely private-label security trusts - offering to buy 626 underwater mortgages at discounts to the homes' current value. If the offers are spurned, the letter said Richmond may use the power of eminent domain to condemn the mortgages and seize them, paying 80 percent of the homes' market value.

The city would then help the underwater homeowners refinance into mortgages in line with their homes' current worth.

Wall Street vehemently opposes the untested idea, claiming it violates property rights and would have a chilling effect on future mortgages in Richmond while leading to years of costly litigation.

http://www.sfgate.com/business/article/Richmond-first-to-jump-into-eminent-domain-battle-4695857.php

[KamaAina]

1. This is Richmond, CA, north of Oakland and Berkeley

not the capital of Virginia.

Mayor McLaughlin is a Green, making Richmond (pop. ~100,000) the largest city in the country with a Green mayor. She led a contingent of Occupiers down the road to Oakland to support the main group there.

[GiaGiovanni]

7. Thanks for the clarification

California was ground zero for the mortgage crisis

[Jesus Malverde]

15. Updated the title to be clearer., thanks!

[The Magistrate]

2. Good For The Mayor, Sir

This should be done all over the country.

[Volaris]

3. ummmm...violating Property Rights for the good of the Many,

Last edited Tue Jul 30, 2013, 08:25 PM - Edit history (1)

is WHY THE FUCK EMMINENT DOMAIN EXISTS IN THE FIRST PLACE.

Fuck Wall Street. I say, you don't have Property Rights as Corporations ANYWAY, so any offer of Eminent Domain that pays out 80% is a fucking GIFT, you goddamn Grifters.

Good on the Mayor, and SHE has my support in this endeavor.

[KamaAina]

9. He is a she

and you are 100% correct.

[Volaris]

16. editing to fix..sorry was sleepy.

there it's done=)

[Starry Messenger]

4. k&r

[codemoguy]

5. I don't know the reasons other cities decided not to do this...

but a couple of possible issues I can see:

- lots of legal fees
- city will probably end up owning some number of houses
- I can't see a principle that would allow this action, but not allow the city to 'take' a car loan (and those are underwater from pretty
much the first day) ...repo'ing a car is analogous to foreclosure

uncharted waters are frequently treacherous...

edited for spelling

[KamaAina]

10. What interest would a city have in taking a car loan?

Foreclosed-upon potentially vacant properties are blight. Maybe if the car was propped up on cinder blocks in someone's yard?

[codemoguy]

12. I don't see the city would benefit from it either....

just that it seems they could do it...
you never know who will be running the city in the future

[KamaAina]

13. To invoke eminent domain, you must declare the property to be "blighted"

or that you're taking it for some other public use such as building a highway.

Of course, some places play fast and loose with the definition of "blighted", such as Long Branch, NJ, which is trying to use eminent domain on a neighborhood of modest single-family homes next to the ocean so it can replace them with glitzier, and more lucrative, oceanfront condos.

[codemoguy]

14. that's part of my thinking...cities have tried to condemn properties

to allow for building of high priced developments that will pay more taxes, or maybe 'bring jobs'

it's a risky power for gov't to have

[awoke_in_2003]

11. No less treacherous...

than letting the banks get the property for pennies on the dollar.

[freshwest]

6. Ending homelessness instead of feeding the vultures? Rebuilding the Commons?

Yes, I'm a socialist. So sue me!

[Luminous Animal]

8. Good news. She is a really good mayor. She is also has set up an "American Worker Cooperative"

http://greencollarcommunities.wordpress.com/2012/11/19/richmond-leading-the-way-with-the-launch-of-a-worker-cooperative-loan-fund/
Richmond leading the way with the launch of a Worker Cooperative Loan Fund!

A new source of small loans is now available for Richmond businesses operating as worker cooperatives. This is part of an effort to encourage job seekers and entrepreneurs to band together and create their own workplaces. .

[Liberal_in_LA]

17. i hope it goes well for the city and the homeowners