Neighborhoods across America have been devastated by the foreclosure crisis and the homeowners who remain now find themselves in communities speckled with vacant and abandoned homes, which cause the value of their homes to plummet. These are the same neighborhoods where families, who felt as though they were living the American dream, would get together for cookouts and social gatherings. Unfortunately, predatory lending and the foreclosure crisis hit Cleveland early and hard. The high rate of foreclosures aggravated an already prevalent issue: the permanent oversupply of poor quality housing due to population loss.
Demolition of abandoned and vacant properties should be a critical part of revitalizing our neighborhoods. Without market demand for the excess stock of blighted homes, tens of thousands of structures sit vacant and condemned, robbing neighborhoods of value. Vacant properties invite crime, discourage private investment, destroy a city's tax base, and disrupt the quality of life of other residents, all while preventing other economic development programs from succeeding. And, unfortunately, as people see the value of their homes decline, they are more inclined to leave, making the problem worse. It's a vicious cycle: foreclosures cause a decline in home values, which is accelerated by underwater homeowners who abandon their properties.
But there are some homeowners who refuse to give up on their communities, and who refuse to stop paying on underwater homes. In December, 60 Minutes visited a group of homeowners in Cleveland, many of whom continue to pay on mortgages that are underwater because they are still able to do so. They are keeping their neighborhood afloat. "That's how I was raised. Once you sign a contract, you uphold what you can for as long as you can," one woman said.
As the crisis hit Cleveland, the foreclosure rate skyrocketed and banks failed to step in and take responsibility for abandoned structures. If you were to drive down a section of East 69th Street in Cleveland in my district, you would understand the dire need for demolition. In one short block, 40 percent of the homes are either condemned or have already been demolished, but the City of Cleveland lacks the resources to clear all the properties that are condemned. City officials estimate 8,000 to 9,000 homes are in need of demolition, at a cost of anywhere from $7,000 to $10,000 per home. It's why I coauthored a bipartisan demolition bill, The Restore our Neighborhoods Act of 2012, along with Congressman Steve LaTourette (OH-14). The bill establishes a bond program to finance demolitions to eliminate blight and curb crime as well as aid the recovery of property value for homeowners, especially those who don't want to leave their neighborhoods. The bonds will encourage public-private partnerships and provide interest free dollars for demolition that can be used for commercial and residential demolition. We can revitalize our neighborhoods and it can start now. Please urge your member of Congress to support the bill.
This morning, Reps Fudge and LaTourette hosted a press conference in Cleveland to introduce The Restore our Neighborhoods Act of 2012. The event was held at 3445 East 69th Street, one block from where a 19-year-old mother and her one-year-old daughter were abducted and killed in in a vacant garage last month. Many supporters joined the members, including Cleveland Mayor Frank Jackson; Jim Rokakis, Director of Thriving Communities Institute; Gus Frangos, President of the Cuyahoga County Land Reutilization Corp.; Cleveland Councilman Tony Brancatelli, Ward 12; and officials from other Ohio cities.