Police Chief Howard Jordan addresses the City Council about a recent crime report during Tuesday's meeting. Photo by Angela Hart

Oakland city council approves new plans to address foreclosures

on October 18, 2012

During a heated meeting Tuesday night, Oakland City Council members approved two new plans to address the city’s foreclosure crisis in Oakland, and also accepted with mixed reactions a lengthy police department report about crime reduction efforts for the city.

The first of the foreclosure plans, initially unveiled by Mayor Jean Quan in a press conference last week, will among other things create a city-run bank account to be used for the purchase of private homes that are “underwater,” meaning they have lost so much market value that they are worth less than the outstanding loan debt their owners must repay.

Under the new program, which was approved by a unanimous council vote and will be funded by a grant from the U.S. Department of Housing and Urban Development, and various banks, the city itself will buy some of these properties, then sell them back to the homeowners for their current worth. In addition, the program will set up new city services to counsel homeowners in foreclosure trouble, and when necessary, help them directly in their efforts to receive loan modifications from banks.

Some residents speaking at the council meeting said they believed the action is too little, too late to help the city. “It’s nice that we are doing something,” one man told the council, “but it’s worth admitting that the ship has sailed.”

But other Oakland residents said they were pleased with the council’s efforts. “The ship has not sailed,” Judith Rathbone, who has lived in Oakland for the past 30 years, told council members. “My income is $45,000, and I’m very worried that I’ll be caught in that middle place where I don’t earn enough to qualify to stay in, and that the mortgage will be too big. I’m very concerned about the future of my home. I’m very happy with all you’ve done, and I urge you to do more.”

A June report released by the Urban Strategies Council, a non-profit organization that works to reduce poverty in neighborhoods, found that since 2007 there have been over 10,000 foreclosures in the city of Oakland. Addressing the council Tuesday night, Quan said that at present 3,000 homes in the city are at risk of entering foreclosure.

In their second foreclosure-related action of the evening, council members also approved an ordinance whose final vote had been postponed at their regular meeting two weeks ago. The ordinance would force tighter regulations on investors, many of them from outside the area, who buy foreclosed residential properties in Oakland with no intention of living there.

The measure requires any such buyer to complete a building inspection within 30 days of the purchase, to make sure the building meets health and safety codes.  If the property is found to have any violations, the ordinance gives the investor 60 days to make necessary repairs.

At the October 2 council meeting, council members had tied 4 to 4 on the ordinance, which was introduced by council member Desley Brooks, and voted to postpone the final vote to Tuesday evening. Quan, acting as the tiebreaker, voted Tuesday in favor of the measure.

Brooks’ ordinance requires property owners to pay a $568 fee to the city for inspection and registration, and calls for for a database tracking all new investors who buy Oakland foreclosed property that is “Non-Owner Occupied,” as the official language puts it.   The version the council finally approved contained amendments introduced by Councilwoman Rebecca Kaplan.  It now exempts properties that are in the process of a short sale, but have not yet received a notice of default.   In other words, if the new buyer wants to sell a property back to the lender for less than what it’s currently worth, but hasn’t received a notice from the bank that says the owner has stopped making payments, then he or she would be exempt from the ordinance’s registration and inspection requirements.  And Kaplan’s second amendment, approved by the council, removes an exemption for investors who have bought fewer than six properties–meaning the new rules now apply to all non-occupant investors buying these foreclosed residences.

Councilmembers also discussed a recent city report on crime reduction strategies in Oakland.

The report, prepared for the council by Police Chief Howard Jordan, tries to offer more insight into current crime reduction initiatives, many started under former police chief Anthony Batts, that are intended to address problems plaguing the department—especially police staffing.

These initiatives include Operation Ceasefire, a plan that singles out certain violent offenders and gives them a choice between receiving community support, such  job training and education, or expecting highly intensified scrutiny from police.

Another approach the department has put into place is more officers on foot patrol. “An officer leaving the car and being seen in the community has a dramatic effect on how community members perceive safety in their neighborhoods,” the report reads.

But the report also criticizes the city council for what it calls inadequate efforts in addressing the number of police officers serving in the department. OPD currently has 640 sworn members, which the report calls “historically low levels.”

The department is currently trying to figure out where most crime occurs in the city by identifying hot spots.

But council members objected that the report contained no plan significant enough to reduce crime in Oakland.

“I think crime is off the hook right now,” said Councilwoman Jane Brunner. “I am really concern that we don’t have a crime reduction plan.”

“One of the problems with Oakland is that we hang our hat on one thing,” said Brooks. “Right now it is Ceasefire. We won’t know whether that would work for at least another year.”

Some council members felt the police department has not been given the right tools to get the job done from the city council.

“Sometime it’s easier to put everything on one person and expect result,” said Councilman Ignacio De La Fuente told Jordan. “This council and this mayor were not willing to give you some of those tools.”

The police department is under a lot of micromanagement, said Councilwoman Pat Kernighan, and the city should ease off.

“We need let the police chief be the chief,” she said.

Correction: An earlier version of this story erroneously reported that one of Councilwoman Kaplan’s amendments to the new foreclosed-property registration and repair ordinance exempted buyers of fewer than six properties.  The opposite is the case–the amendment removed this exemption.  We apologize for the error.

1 Comment

  1. Allan on October 18, 2012 at 11:59 am

    Remember – if mortgage holders foreclose on underwater property – they will not recover full value. We should not pay full value. City should put together a large pool of underwater properties – tell mortgage owners to bid on discounts – deal with best offers. Another plus – less chance of favoritism.



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