Senator Johnson-supported bill protects home values, tackles aftershocks of the foreclosure crisis
The State Senate last week passed landmark legislation that would protect neighborhoods and property values from the ripple effects of the national foreclosure crisis.
The Neighborhood Preservation Act, (S.1152), which was co-sponsored by Senator Craig M. Johnson,(D-Nassau), creates a standard of safety and habitability for bank-owned homes that are foreclosed and vacant. It further allows municipalities to use their discretion in how they chose to clean up these unsightly residential properties and how they choose to get reimbursed for their work -- whether by issuing violations, through legal action, or by simply billing the bank.
According to a report by Deputy Majority Leader Jeff Klein (D-Bronx/ Westchester), the main sponsor of the Neighborhood Preservation Act, those living near foreclosed properties will see their home values decrease by $5,000 on average per each foreclosed home. For every 100 owner-occupied properties in one year, there are 2.8 foreclosures which directly correspond to an increase in neighborhood violent crime by approximately 6.7 percent.
Senator Johnson said the need for the Neighborhood Preservation Act became clear as lending intuitions, including those who accepted federal TARP funding, by and large refused to voluntarily maintain properties in their possession.
"It is sad that many of the same lending institutions that gladly took taxpayer money to buy new drapes and take lavish trips to Las Vegas have to have their arms twisted to be a good neighbor," Senator Johnson said. "I commend Senator Klein for authoring this common-sense legislation and for leading the fight to hold these lending institutions accountable, and to preserve the quality and character of our neighborhoods."
In Nassau County, alone, there were 911 lending-institution owned properties with 271,875 neighboring homes devalued due to foreclosure, according to Klein’s report. This point was illustrated during a December press conference announcing the legislation in front of a dilapidated bank-owned property in Westbury that became a blight on the neighborhood.
"As the foreclosure crisis spreads, we’re seeing a ripple effect as property values plummet and surrounding neighborhoods experience an increase in quality of life issues like graffiti and crime," Senator Klein said. "One foreclosure can devastate an entire community and threaten the safety and well-being of innocent families We need to curtail this crisis and end the shameful lack of responsibility on the part of the banks that has permeated the American Dream of homeownership We cannot allow our communities to become casualties of the foreclosure crisis.
The legislation has been sent to the Assembly.
"The devastation of home foreclosure effects everyone, not just the family facing the loss of their home, but the entire community. Empowering a municipality to force banks to take responsibility for foreclosed property protects property values and preserves the character of our neighborhoods ," said Senate Majority Leader Malcolm A. Smith.
A video of Senator Johnson explaining his vote on the Neighborhood Preservation Act can be found at www.nyssenate7.com/.