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New Program Would Help Lower Costs To Rehab Vacant Louisville Properties

Vacant Properties-5
The house in Shawnee has been abandoned for as long as neighbor George Palmer can remember.

Grass swirled around Chris Turner's ankles as he worked the whirling weed whacker along his fence.

Turner spent part of a recent weekday outside tending to his yard at his home on Bank Street in the Portland neighborhood. His young son played with toys and his large dog sniffed around as he worked.

His neighborhood is one of the city's poorest, and it shows in the vacant properties and blighted lots that dot the area. But Turner likes living here -- he has for about five years -- and he isn't planning to move.

In fact, he's even considered expanding his investment in Portland by purchasing the vacant, crumbling house next door with the overgrown lot.

"I've been trying to buy that house since I got here," he said.

The house is buried in property maintenance fines and tax liens, however, and Turner said those added costs make it unfeasible for him.

Situations like this are not unique. And there are more than 5,000 vacant structures across the city, according to a recent report from Louisville Metro government.

So, to help support people who want to rehab vacant properties, city officials are moving ahead with steps to start a tax delinquency diversion program.

Corporations, banks or other entities often purchase tax liens on properties and sit on them, as interest on the liens accumulates. This bogs down redevelopment efforts, as buyers first have to pay off outstanding tax liens owned by those entities to clear property titles.

Under the program, the sale of tax liens on properties in designated areas would be prohibited for five years.

Laura Grabowski, head of the city's office of vacant and public property, said it's unclear just how many of the 5,000 vacant properties in Louisville have tax liens owned by multiple parties. But those that do are often a burden for city officials or private parties to obtain ownership of to renovate or remove.

"It reduces the number of interests that attach to properties," she said.

Next week, Metro Council members will examine an expansive list of potential areas designated for the program. Many are within seven council districts across western and southern Jefferson County, where vacant properties are most concentrated, Grabowski said.

Second District Councilwoman Barbara Shanklin has been leading the effort and said the program is one of "the best things to happen to vacant and abandoned properties in quite some time.”

Turner sees the upside to such a plan. But for him, it won't bring much change. There's no retroactive element to the program, and the house next to his home is deeply indebted, he said.

City records show the owners are on the hook for more than $28,000 in property maintenance fines. What's more, city officials refused to accept the property as a donation from the owner earlier this year, which Grabowski said often happens when third parties own existing tax liens.

Turner sighed and said the legislation should have been in place a decade ago.

For this house, he said, "the damage has already been done."

Jacob Ryan joined LPM in 2014. Ryan is originally from Eddyville, Kentucky. Email Jacob at jryan@lpm.org.