Saturday, July 22, 2017

Properties in Holyoke Revived by Efforts of Problem Property Group


City officials credit the Problem Property Group in Holyoke for improving coordination of city-wide blight remediation efforts including filing cases in Housing Court seeking the appointment of a receiver for vacant and blighted properties.

For 235 Oak Street, the necessity of a Receiver became certain after a Problem Property Group meeting during which several city officials shared data and reports detailing the long history of code violations, public complaints, and worsening conditions at the property.  On May 20, 2016, upon finding the property owner unable to correct the outstanding code violations, the Housing Court appointed AAD LLC as Receiver responsible for rehabilitation of the property.

“The Problem Property Group has vastly improved our capacity to identify problem properties, determine the appropriate course of action - whether receivership, administrative code enforcement, monetary fines, or tax title foreclosure- and collaboratively implement the process necessary to bring the property back into productive, code-compliant use.” says Assistant City Solicitor Paul Payer.

While rehabilitation at 235 Oak Street is ongoing, the neighborhood-wide impact of the Receivership program is most evident at recently completed projects. Beginning in late 2015, the property of 73-75 Belvidere Avenue was in total disarray. The property was full of trash, the roof was unstable, walls were unfinished, and the building overall was uninhabitable. JJS Capital Investment LLC was appointed receiver of 73-75 Belvidere Avenue and completed work on its comprehensive rehabilitation plan in January 2017. The Receiver foreclosed on its receiver expenses lien, listed the property for sale and completed sale to a private party in early March.  

The appointment of a receiver is a “last resort” remedy authorized under M.G.L. c. 111, section 127I, after an owner has failed to comply with administrative and court orders to correct violations of the State Sanitary Code.  The process to appoint a receiver is as follows:

  • Inspection of property to document violations of State Sanitary Code, State Building Code and city ordinances
  • Administrative order to correct the cited violations is issued to the property owner(s) and any bank with a mortgage interest.
  • City inspector conducts a re-inspection and issues ticket fines for outstanding code violations
  • City inspector may condemn the property as unfit for human habitat
  • The City Law Department files a Petition in Housing Court seeking enforcement of the State Sanitary Code
  • The Housing Court holds a hearing and may order the property owner to correct code violations
  • The City Law Department files a Motion to Appoint a Receiver if the property owner has failed to comply with the Court’s order to correct code violations
  • The Housing Court holds a hearing to determine whether appointment of a Receiver is necessary to bring the property into code compliance  
  • If appointed, the Receiver is responsible for cleaning and securing the property and must file a comprehensive rehabilitation plan within three weeks.
  • Every eight weeks, the Housing Court conducts a review hearing of the receivership.  Prior to each hearing, the Receiver submits a report of rehabilitation progress and expenses and the City performs a re-inspection to verify the Receiver's report.
  • The cost of the Receiver’s repairs constitute a lien on the property.  The Receiver’s lien has priority over all other liens, including mortgages, with the exception of tax liens for unpaid municipal real estate taxes and certain other state and federal tax liens.
  • If the Receiver’s lien is not paid by the Property Owner or Bank, the Receiver may ask the Court to authorize the Receiver to foreclose on the lien and seek recovery of Receiver expenses through a foreclosure auction sale or listing the property for sale.  

“The work that the Problem Property Group has done so far is exactly what we need to move the city in the right direction,” says Holyoke Mayor Alex Morse. “All families deserve to live in great neighborhoods. As these city officials tackle these issues head on, I believe we will see vast improvements within the coming years. We will be able to attract new business and development in the city when our buildings and houses are ready for use.”

As of July 2017, the City of Holyoke has 12 active receiverships.  

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