Blight Buster

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Erica Ward Gerson heads the Detroit Land Bank, renewing Detroit one home at a time.

Erica Ward Gerson, head of the Detroit Land Bank, at one of the abandoned Detroit homes up for sale and rehabOne year before Mike Duggan declared his candidacy for Detroit mayor, he scheduled a lunch meeting at Roma Cafe on Riopelle Street in the city.

His guest was Erica Ward Gerson, board chair at the Detroit Medical Center’s Children’s Hospital of Michigan. She had known Duggan for years through his role as head of the DMC, and figured he wanted to discuss hospital business.

But when Gerson arrived, Duggan leaned forward and told her something she wasn’t expecting. He was considering a run for the mayor’s office.

He said he thought he could make a difference, but only with a robust plan to tackle the city’s throngs of abandoned and deteriorating properties.

“I can’t do it unless I come up with a policy I believe in to cure blight in the city; because if I can’t cure the blight, nothing else I do will matter,” Gerson recalled him saying.

So he asked her to help write the framework. Duggan ran on the policy, won his election and assumed office in January. Six months later, the city’s reorganized Detroit Land Bank Authority has auctioned more than a hundred vacant homes, many of which are now on their way to renovation and occupancy.

Building An Institution

A corporate and finance lawyer by trade, Gerson didn’t know much about blight busting or land banks — the public entities created to acquire, manage and develop abandoned properties. But over the next year, she worked with Duggan to consult other land banks, interview experts, sort through best practices from around the country and compile an 80-page policy paper that ultimately informed a central pillar of his policy platform.

Two days after declaring victory last November, he called Gerson and told her it was time to implement the policy she helped compose.

Gerson, who lives in Bloomfield Hills and is a member of Congregation Shaarey Zedek in Southfield and Temple Beth El in Bloomfield Township, already had retired from Skadden Arps, where she practiced law for 30 years.

Her husband, Ralph Gerson, a nephew of the late Bill Davidson and a director at Guardian Industries in Auburn Hills, said he wasn’t surprised his wife took Detroit’s new mayor up on his offer to appoint her chair of the Detroit Land Bank Authority.

“When someone asks her to do something that really has the potential to make a difference in a community like Detroit, I knew she would have a very hard time saying no,” he said.

In an interview with the JN, Duggan cited Gerson’s background in law and experience as deputy director for domestic policy at the White House as key factors behind recruiting her for the project.

“The complexity of the blight problem is amazing,” he said. “You have HUD regulations, you’ve got banking regulations, you’ve got environmental regulations, and so I was looking for someone who could take this maze of complex regulations and make it into an understandable program to reuse the houses in the city.”

This house on Euclid is one of 21,579 homes now owned by the Detroit Land Bank. With a shoestring staff of five people, Gerson started her tenure with the Land Bank writing purchase agreements and assisting with the other day-to-day tasks needed to get the operation moving during the administration’s first month. Since then, the team has grown to a 65-person staff.

For outside observers, perhaps the most impressive facet of the initiative is the speed at which the Land Bank has been able to implement a plan to tackle blight. Since starting the process in April, the Land Bank has auctioned 130 houses and closed on 40, generating $2.25 million in sales.

That’s no surprise for Larry Gold, CEO of the Children’s Hospital of Michigan, who lauded Gerson’s ability to understand complex issues, unpack them and execute a plan.

“She moves between strategy and implementation so easily,” he said.

 

How It Works

Tackling blight in Detroit certainly requires both the strategy to chart an inventive plan and the agile machinery to produce results. To start, the problem is big. In Detroit, at least 48,000 homes are unoccupied, totaling about 13 percent of the city’s housing stock.

On top of a long-term population decline propelled by disappearing auto industry jobs and flight to the suburbs, foreclosures devastated dozens of stable neighborhoods when the economic downturn pummeled Metro Detroit in 2008.

To address those realities, the Land Bank’s current model builds on a procedure called nuisance abatement that Duggan first piloted as Wayne County prosecutor. In that role, Duggan won a court decision that ruled abandoned houses — like uncut grass or excessive noise — should be considered a nuisance to a neighborhood. Because governments have a responsibility to eliminate nuisance, they also have the standing to sue delinquent property owners and seize the parcels.

In those days, Duggan was seizing and auctioning houses to new owners, but the program was discontinued after he left the prosecutor’s office. In the following years, a five-person staff at the Detroit Land Bank renovated and sold vacant homes, mostly in historic neighborhoods like Boston-Edison, using federal neighborhood stabilization funds. However, those projects were expensive, and the Land Bank was only able to complete a few dozen houses over a couple of years.

 

Larger Impact

For the new policy to have an impact, it would have to occur on a much greater scale. The reorganized Land Bank — established under an intergovernmental agreement between the city and the state — has acquired properties owned by the city, county and state, as well as through the nuisance abatement model Duggan pioneered as a prosecutor. In January, the Land Bank owned less than 1,000 properties. That figure has now grown to 21,579.

By collaborating with multiple government agencies, the Land Bank is collecting most of Detroit’s blighted properties under a single entity responsible for both demolitions and auctions, funded in part by government grants and philanthropic donations. The Land Bank has demolished 1,308 houses since the start of Duggan’s administration and is on track to reach 3,300 demolitions by the end of the year.

Still, Duggan has insisted demolition shouldn’t have been the city’s only strategy.

“I believe the city’s history of demolition has been a mindless strategy, and I wanted to change the direction from demolishing to fixing up these homes and moving families in,” he told the JN. “We thought that was key to turning the city around, and that’s been a big part of what we’re doing.”

Today, the process begins by identifying neighborhoods where the Land Bank will likely have the greatest impact. Rather than auctioning homes in neighborhoods like Brightmoor, which has been plagued by widespread vacancy, the Land Bank is looking for neighborhoods where occupying the handful of empty houses could make big strides in stabilizing the street.

Screen shot of home page from Motor City MappingSo far, the Land Bank has focused on neighborhoods like Boston-Edison, East English Village and Marygrove.

Though some residents are concerned this policy privileges select neighborhoods while leaving others behind, Gerson said spreading the efforts across the entire city would result in less impact.

“We stake our ground on a neighborhood that is strong today, and we slowly try to expand those zones little by little so that we can expand the size of the neighborhood we’re stabilizing,” she said.

Using data from the Motor City Mapping Project, an initiative convened by the Dan Gilbert-led Blight Task Force to provide a detailed picture of Detroit’s more than 370,000 properties, Land Bank officials can see which parcels are blighted and who owns them.

If the property is privately owned, the Land Bank posts signage telling the owners they must sign a consent order agreeing to bring the house up to code and occupy the building within six months. If they fail to comply, the Land Bank files suit to seize the property. So far, officials have postered 1,300 houses since April and filed more than 500 lawsuits. The Land Bank has won every case.

Next, officials determine which homes are too far gone and require demolition. The rest are put up for online auction at buildingdetroit.org. Winning bidders have six months to fix up and occupy the house, often with help from banks that are partnering to offer funding to new homeowners. Purchasers of historic homes are given nine months to complete the process.

“It has brought a sense of hope to the city that we didn’t have before necessarily,” Gerson said. “Everybody wanted it, but until you began to see some actual progress, there’s a lot of skepticism after a lot of promises not kept over the years to the citizens of the city. So I think that inside the city there is a real sense that finally someone has promised to do something and they are. And that’s really startling.”

The Land Bank’s model is the first of its kind in the country, and Gerson said it has the potential to influence the ways in which other cities cope with blight.

“If we can bring Detroit back, it’s a model for every other city in the country,” she said. “There are a lot of other rust belt cities that have very similar problems. Maybe they haven’t gone to bankruptcy yet, but they’re not dissimilar. Maybe the scope is different, maybe the scale is smaller; but if we can pull this off here, it’s monumental.”

Open House

At a Sunday open house in mid-August, potential bidders circulated through a house on Wisconsin Street in the city’s Bagley neighborhood. The two-flat Tudor near Marygrove College was built in 1929. The facade boasts sweeping rooflines and a big bay window, but the front door is boarded with plywood and the kitchens are missing appliances and most of their fixtures.

003Detroiters Carol Zachary and Cynthia Morgan toured the house looking for an investment property to rehab and rent.

“I have a vested interest in the city because I do live here,” Zachary said. “That’s the motivating factor — to bring some of the houses that have good bones — to bring them back. The original workmanship is not comparable to what you’re going to find going up now so I think it has good potential to continue to be a viable neighborhood.”

Tamica Dothard, an open house supervisor, said she’s seen a diverse array of people attending the open houses, from businesspeople looking to turn a profit to families, young people and empty nesters — both working class and professional — searching for a home in the city.

But Dothard said it’s harder to generate bids in some neighborhoods — each has its own unique challenges, character and history.

While the first open house in Boston-Edison turned out a thousand people, homes in other neighborhoods don’t get the same response.

The cost to rehab homes varies, too — depending on the structure’s condition and the amount of work the homeowner wants to put into the property.

Dothard noted that working with active block associations, residents and other neighborhood leaders is critical to the program’s success.

Next door, one neighbor said she thinks that occupying the house will be a big improvement for the neighborhood of mostly tidy homes.

“It not being occupied wasn’t a good thing,” she said.

 

Home Place

Though there are plenty of people who aren’t looking to buy and inhabit a house in the city, Gerson said there’s good reason for the wider community to take an interest in efforts to rehabilitate the city’s neighborhoods.

“This is a home-place,” she said. “This is a real cultural home for an awful lot [of people] in our [Jewish] community. And, yes, they moved away from it, but I’m hoping they will get reconnected.”

When she was asked to choose a house to photograph for this story, Gerson selected a Land Bank property for sale in Virginia Park — the neighborhood where her husband’s grandparents once lived. The Euclid Avenue property sold last week for $5,100.

According to Wendy Rose Bice, executive director of the Jewish Historical Society of Michigan, the neighborhood was home to a large Jewish population from the 1910s-1930s.

Virginia Park is just south of the Boston-Edison neighborhood. Woodward Avenue and Linwood Avenue form the west and east borders, stretching between Clairmount Avenue to the north and Virginia Park Street to the south.

The neighborhood attracted both up-and-coming Jewish families and new immigrants moving into the city. The area contained several Jewish shopping districts, a branch of the Jewish Community Center and Hebrew Free Loan.

Gerson said congregants at synagogue are often fascinated by the work she’s doing, especially in the neighborhoods where they have ties.

“Often what you hear about is their experiences — for themselves or their parents — growing up down here in Virginia Park, in Boston-Edison,” she said. “The old Shaarey Zedek, the old Beth El, they were all here, so this is not a distant memory for most people. And I think they’re incredibley excited to hear that it’s coming back.”

But Gerson said those ties don’t have to remain solely in the past. She said opportunities to work and live in Detroit are expanding exponentially, but the community hasn’t fully tapped in to the city. Young people, she said, are ahead of the rest in getting involved.

For Gerson, Duggan and other community leaders, ensuring Detroit neighborhoods thrive is vital to the city’s rebirth — and the region’s.

“If the city doesn’t succeed, the tri-county area can’t succeed — and if the tri-county area can’t succeed, the state can’t,” she said. “It’s critical to all of our futures. You can’t just draw a line at 8 Mile and say it doesn’t affect me.” 

 By Sam Gringlas | Special to the Jewish News; Photos by Jerry Zolynsky

For more information on properties in Detroit, go to www.motorcitymapping.org and http://auctions.buildingdetroit.org/home. Sam Gringlas of Farmington Hills is a junior at the University of Michigan in Ann Arbor, where he is senior news editor at the Michigan Daily.

 

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