Detroit Land Bank oversight at issue as neighbors complain of poor upkeep

Correction: A previous version of this story referred to Mike Nevin as the Detroit Fire Fighter Association president. He no longer holds the title.

Detroit — Jackie Smith is fed up with the house next door.

She says it has been vacant for over a decade and has been nothing but trouble for her and her grown daughter, Kellie. The paint, which is curling up and flaking off, contains lead. Smith had it boarded to keep out squatters and animals. And roof shingles keep falling onto her property.

Smith wants the house demolished, but the owner tells her there’s little they can do. The house is one of 16 parcels on Smith’s block owned by the Detroit Land Bank Authority, a quasi-city agency that now owns a quarter of Detroit properties, including about 22,000 homes.

The Detroit Land Bank Authority is the largest property owner in the city, but the properties it owns are not evenly distributed. The darker areas show Census blocks where the Land Bank owns a greater percentage of the parcels on the block.

Sources: City of Detroit Open Data Portal and U.S. Census Bureau

“After all these years, it’s still there,” she said. “And yeah, I’m frustrated with it. ‘Bout ready to start taking it loose myself, brick by brick.”

Wayne County foreclosed on the house next door in 2011 and transferred it to the land bank in 2014 when the city was trying to consolidate ownership of vacant residential property under one agency.

Today, half of Smith’s block — as defined by census blocks, meaning the land to either side of Smith’s house and to the rear, surrounded by four roads — is owned by the land bank, according to city assessor data. Three-quarters of all residential property in Detroit is on the same block as at least one land bank-owned property, according to the same assessor data.

The city's contract with the land bank, which has the largest inventory in the nation, expires this June, amid complaints from residents over which properties it chooses to maintain, sell and demolish. Some city officials want more oversight of the agency written into the new contract.

City Ombudsman Bruce Simpson said the size of the Land Bank’s inventory has become unmanageable. His office, which is an independent agency meant to act as a liaison between residents and the city, fields many complaints, mostly about blight, and roughly a quarter of them are about land bank-owned properties, Simpson said.

Simpson said he believes the land bank needs to be brought more squarely under city control.

“I think that the city should manage its own land,” Simpson said. “I think that’s common sense.”

'Funding is limited'

The land bank pays more than $3 million to mow lawns in front of the houses it owns, according to spokesperson Alyssa Strickland. The team responsible for boarding up land bank properties believes it has boarded up each house and now must focus on maintaining and re-boarding.

“The DLBA understands that our neighbors are frustrated with living next door to the vacant houses we own,” Strickland said in an email. “Because funding is limited, the DLBA can’t rely solely on demolition to eliminate blight. Our sales programs get houses out of our inventory and back into the hands of Detroiters.”

Many Detroit properties are blighted beyond repair, but some are more likely to get demolished than others. Residents like Smith, who are not located in a Hardest Hit Fund zone, live in areas that are not eligible to receive the federal funds for demolition.

In 2013, after a successful push from the state and cities like Detroit, the U.S. Treasury gave Michigan approval to use some federal mortgage assistance funds for demolition. To use those funds, the land bank drew the boundaries of zones where demolition could have the most impact, based on the program requirements.

The city must fund demolitions of properties outside those zones, which is a bill they say they can’t foot all at once. It means that residents who aren’t in HHF zones will likely have to live next to land bank houses longer.

“So people are very justifiably frustrated out there because they've been sitting next to a vacant and abandoned house and they want it torn down,” land bank executive director Saskia Thompson said. “And it seems like a less than satisfactory answer for anybody in the neighborhood to say, ‘Sorry, we don't have funding to knock it down,’ but that's the reality of where we've been the past several years.”

Most land bank properties come from the Wayne County tax auction. If a house is not bid on in the auction, it moves to the land bank, which is then charged with maintenance, sales and demolition of those properties. Today, that means a staff of 145 is responsible for about 90,000 parcels across the city — far more parcels than the total number in either Flint or Lansing.

The land bank strategy has been to focus its limited resources where it can be the most “productive,” according to Thompson, which means that demolition, maintenance and sales are done in areas that are more occupied.

“Clearly there is a tremendous amount of work to be done and a lot of neighborhoods and blocks where the city and Land Bank have not been able to get to, due to funding,” city spokesperson John Roach said in an email.

He said that is why Mayor Mike Duggan pushed for a $250 million bond proposal last year that would fund demolition and renovation. The City Council rejected the proposal, but the mayor’s office plans to introduce a different version.

In the meantime, Detroiters living on land bank-dominated blocks — people like Smith and her daughter — say they have little recourse to make their next door neighbor mow their lawn or keep out squatters.

“Somebody need to be paying me,” Jackie said, later adding, “because it’s a job for me to be taking care of this house, and it’s not even mine, you know.”

Where the properties are

For Detroiters living near more vacancy than Smith, the issues can be more severe. The land bank owns a third of all residential property and is the largest property owner in the city, by far. But its real estate is not evenly distributed.

Downtown, the land bank does not own a single parcel. But in several patches of the city — like over on the far east side between Gratiot and Hayes and in the area just southwest of the Eight Mile exit on Fisher Freeway — the land bank owns the majority of some blocks. Nearly 10% of all Detroit residential property is on blocks like these, ones that are at least half-owned by the land bank.

The scale of the land bank’s inventory and obligations is something Thompson, the executive director, called “unprecedented.”

Since 2014, the Land Bank has sold about 4,000 houses that have since been rehabbed in compliance with its sales policies, according to Strickland, the agency’s spokesperson. They have also demolished over 13,000 houses and sold over 14,000 side lots.

“I've never seen an organization like the land bank work at the scale and the speed that it is. It's had to come up with programs that simply didn't exist anywhere else,” Thompson said. “There were no models to follow.”

In an interview last year, two members of the land bank's inventory team explained a strategy of focusing resources — whether for sales or demolition — on more stable neighborhoods because that is where they can have more impact. Thompson confirmed this policy: the land bank has a vast portfolio and limited funding, so they try to sell where there will more likely be a buyer and demolish in areas where someone is more likely to buy the house next door.

The flip side of that strategy is that neighborhoods where the land bank dominates the property ownership are less likely to get the land bank’s attention.

Craig Browning is the last resident on his block in Brightmoor. Every other property — both houses and vacant land — is owned by the land bank. In the six years he’s owned his home, Browning has become a steward of the block, shoveling the snow and raking the leaves.

“My last breath, I’ll be doing yard work,” Browning said. “You can bet on that.”

For Browning, the emotional and physical toll of being the only remaining resident gets to him. He says he also runs off the squatters and vandals.

“I don’t have a problem with it. I used to be a biker, so I got a lot of heart inside my little bitty chest,” Browning said, adding that he also tries to keep people from dumping garbage on his block. “I run them all off. This is where I live. I want it to look good.”

Last year, a land bank property next door to Browning was demolished. It’s one less concern for Browning, but an entire block remains, with other vacant lots and blighted structures, that Browning continues to try to maintain.

'A particular situation'

While Detroiters like Browning have been coping with a lack of city attention, private developers have been able to receive a greater degree of flexibility and accommodation.

Last year, the land bank gave 157 properties in a deal with Fiat Chrysler to make way for a 200-acre assembly plant on the city's east side. The project has promised the creation of 6,400 jobs in and around Detroit, with some opportunities opening to city residents before other applicants.

Because the city cannot legally take private property for development through eminent domain, it needed to assemble the needed parcels through other means, mainly payouts and land swaps.

While some took simple cash for their property, others negotiated more complicated deals. Among them was Michael Kelly, a well-known and controversial real estate speculator. Kelly had over $1 million in late tax debt forgiven as part of his deal. He was also given city-owned land and had citations forgiven for blight at his other properties — all for five parcels.

“We did something that I doubt any other city would have tried,” Duggan said in a press conference on the Fiat Chrysler plant last May. “We have assembled almost 215 acres in 60 days without the benefit of eminent domain."

Last week, the city sued Kelly and several other property owners in Wayne County Circuit Court in an effort to stop them from buying large portfolios of real estate with no intention of occupying or improving them.

Today, the city uses land bank inventory as an asset for private development. But Arthur Jemison, the head of Detroit's Housing and Revitalization Department, said that the land bank does not hold inventory as a workaround for overcoming more narrow eminent domain laws; they’re just playing the hand they’ve been dealt.

“We would love to have a lot of this land in private hands being managed privately, so we can just do code enforcement,” Jemison said. He later added, “But because we own so much, you know, it's a particular situation that we're in, and we're trying to be thoughtful and opportunistic.”

More oversight?

This year, the contract between the Land Bank and the city expires, which means the council can approve new terms.

The land bank is an authority, which means it does not have the same oversight as a city department. The agency does not require city council approval for most of its decisions and policies — including when they sell, what information they must provide the public and how they decide which properties to demolish or repair.

The agency is instead overseen by a board that is almost entirely appointed by Duggan. But City Council President Pro Tempore Mary Sheffield says it’s time to give the land bank more oversight.

“In my opinion, the change comes with, at some point, looking at how we dismantle the Detroit Land Bank Authority and bring properties back in-house,” Sheffield said in a phone interview. She later added, “I hear a lot of complaints, a lot of outcry about the lack of transparency, the lack of accountability with the Detroit Land Bank Authority.”

“So really, it’s how do we make the Detroit Land Bank more accountable? Or, how do we dismantle that current structure, because currently it’s not working for the average citizen,” Sheffield said, adding that she thinks developers are able to more easily “navigate the system.”

In January, U.S. Rep. Rashida Tlaib, D-Detroit, said she plans to introduce legislation to “ensure transparency and fight corruption” in land banks across the nation and criticized the Detroit Land Bank Authority for, in her view, favoring developers over potential homeowners.

“My God, most of these homes would never have been in the land bank but for the fact that they didn’t do assessments on people’s homes,” Tlaib said, referencing a recent Detroit News investigation that found widespread overtaxation of Detroit property owners.

In a recent interview with Reveal’s Al Letson, Duggan said he’d be open to the land bank having more oversight from city council, a change that could be possible after the current contract expires.

Fire danger

Vacancy takes a heavy personal toll on people like Smith and Browning, who live on blocks dominated by land bank ownership, but widespread vacancy is also a shared burden for all Detroiters.

Detroit was designed with sprawling single-family homes for nearly 2 million people. Today, with a population that dips below 700,000, vacant structures add to what former Detroit Fire Fighter Association President Mike Nevin calls the “fire load” of the city.

It means there are more things that can catch fire, scattered across a big city, with fewer fire stations positioned to get help there quickly. According to Nevin, this leaves Detroit first responders overburdened.

“We get there as quick as we can,” Nevin said in an interview, later adding, “I've got guys that are driving as fast as they can to some of these scenes.”

The longer it takes first responders to arrive, the worse things are once they get there, according to Nevin.

“There's been a shift in priorities in this town away from the neighborhoods and to the downtown area, and it's horrible,” Nevin said. “The things that my firefighters and my EMS people see are horrible.”

Widespread vacancy has many costs, including the well-being, public safety and peace of mind of its residents. It also takes a toll on Detroiters’ trust in city officials to do something about it.

Jackie Smith’s daughter, Kellie Smith, moved home in 2018, in part, because she was concerned for the safety of her mother. She says she just wants the city to care.

“Where’s the integrity? If you say you’re going to do it, do it,” Kellie said, referring to Jackie’s battle to have the blighted house next door torn down. “I mean that’s what you expect out of residents in the city, you know. Just do it. Care.”

Kellie is ready to leave, but Jackie hasn’t given up on her home. She’s invested too much time, money and energy into her property to call it quits over a bad neighbor.

“This is my little piece of the rock,” she said. “I just want that molehill to be gone.”

Katlyn Alo is the data reporter and news apps director for Outlier Media and MuckRock. Contact her at katlyn@outliermedia.org.