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  • RESOLUTION: It's Time To Do Something (PART II)

RESOLUTION: It's Time To Do Something (PART II)

In the February 24th issue, an article highlighted the problems presented by the disturbing  number of empty buildings in Eads and the county, as a whole.  If the array of commentary received from readers of the Independent is any indication, the concern over empty buildings is shared by a number of people. 

To recap the previous article, empty and abandoned buildings can lead to an increase in crime, a higher risk of the building becoming a fire hazard, health concerns, a decrease in property values, a loss of tax revenues, loss in property value for nearby homeowners, higher insurance rates, and an aesthetic loss of quality of life.  When these costs are multiplied by the number of empty buildings, it becomes quite apparent we are in a crisis situation. 

It is time to do something about it.

The empty buildings on Maine Street serve as a perfect example.  Some of the structures are currently on the tax roll and in decent physical shape, but they are quickly losing value and integrity as they sit empty or, worse, hold storage for items perhaps no longer needed, if not forgotten altogether.  Each one of these buildings, located on one of the few areas that function as commercial real estate, represent lost revenue not just to the current owner but the city, the county, the entrepreneurs who want to open up a business but can't find the space to do so, and, ultimately, we the consumers.  

It is time to do something about it.

There are also the numerous empty houses that are located across the town and beyond.  Each house has its own unique story which tells the tale of why it was left standing empty and, perhaps, abandoned.  Some of the houses were home to someone for years, and that someone has recently passed away, moved into an assisted living facility or to another city or state.  Each one of these houses is a testimony to the community's past and should be sold or rented to people who are truly looking for homes.  We know there is a housing shortage in Eads, yet how can this be when there are so many houses sitting empty?  The answer: most of these homeowners either don’t have the means to rent or sell the property on their own.  Left vacant, as they are, their door is literally closed to those people who would like to live here.  The result?  Those people ultimately find a house somewhere else—like Lamar.  Meanwhile, the town continues to lose its population not because of the quality of life, not because of the lifestyle, not because of the employment market but simply because there is no where to live.  

It is time to do something about it.

Next, consider the abundance of houses that are old, rundown and have sat empty for many, many years.  There is little doubt that these houses are a blight on the community.  They give the impression that no one cares for these properties and, eventually, unscrupulous people will begin to use these properties for purposes that are neither healthy nor positive for the community, as a whole.  

Another potential scenario--these houses might be purchased for close to nothing by industrious individuals who then sell them to the highest bidder from the front range—often, sight unseen—at an inflated price that is ludicrous in this county.  Once the new owner has bought the derelict house at a premium, they quickly realize there is a very limited real estate market here.   That new owner may then try to use the property for "grow houses", as has been recently publicized in local newspapers across rural America, or, perhaps, the new owner will be forced to ultimately just forfeit the house for back taxes as the cost of repair and remodel is not economically viable when compared to the price they paid for its purchase.  The cycle eventually starts over, except now the house is in worse condition than before.  

It is time to do something about it.

In order to come up with solutions for this crisis, we must first examine the systems we have in place in Eads and Kiowa County.  The structure of the town ordinance system, the property tax system, the real estate market, and the financial systems create the perfect storm in which we find ourselves.  Nonetheless, in all this mess, one rule must be understood by all: “The cost of keeping property in use is far less than the cost of restoring it to productive use.”  In other words, it’s time to come up with solutions that address these barriers to keeping Eads and Kiowa County properties in use.

Currently, the Town of Eads has two main ordinances concerning property violations:  one defines the height limitations of vegetation growth in yards and alleys, and the second prohibits multiple untagged vehicles from being stored on properties.  The Town of Eads can also condemn properties, although this rarely happens as the cost to the Town is excessive and provides little opportunity for return.  So, maybe the time has arrived for the mayor and the town council to aggressively address the town ordinances as they concern empty and broken down properties.  The town should also develop a tracking system allowing them to identify the problem properties,  when and how problems with the owners are addressed, and documentation if/when the violation is abated.  This would be a helpful tool for entities to move this real estate market forward.

Rialto-Hotel-Eads-Colorado-Kiowa-CountyAnother problem is our property tax system.  When property taxes go unpaid, they are auctioned off in November to the highest bidder.  The Treasurer’s office is compelled to provide a tax certificate to an investor who pays the taxes and is promised a higher than market interest rate for the investment.  These investors are not investing in the property; rather, they are investing in the paper it represents.  Their goal is not rehabilitation of the empty building.  This practice ties the property up for multiple years during which time it continues to set empty and deteriorate more as each season passes.  Sometimes, governments will attempt to take some of the tax liens on a building in order to save the building or create a business opportunity.  Unfortunately, this is what happened with the Rialto Hotel on Maine Street.  The county, acting in good faith, is now stuck with dealing with a building that has great potential but also has elements of mold and asbestos--two words government officials never want to hear.  Therefore, their current solution is to tear down the Rialto Hotel at a large cost to taxpayers, a cost to the already compromised landfill, a cost to the historic district and a loss of the potential tax and business income that property could have potentially generated.  

One of the biggest problems facing Eads is the lack of a real estate appraiser familiar with the area and the market. Although becoming an appraiser requires a certain amount of education, it could provide a lucrative income for someone who desires to work independently, especially if it was combined with a real estate license.   This is a truly viable business opportunity for someone as the closest appraisers frequently come from Pueblo, Burlington, or Limon.  That’s a pretty broad area that we could cover ourselves. A value-added idea for the realtor-appraiser business is to also contract with property owners to manage the property they own in the area. This is the prime solution not just for the town but the out-of-town property owners, as well, who would like to rent or sell their house but need someone local to manage the property in their absence.  

Finally, the financial situation in Eads and Kiowa County does not “lend” itself--- no pun intended --- to jumpstarting the current market.  However, if there were some reliable appraisals available, it would facilitate property sales and open the market up somewhat.  In addition, we need to take advantage of every possible funding and financial opportunity for rural Colorado that is available.  This includes partnering with our local banks, SECED, Small Business Administration, HUD, USDA, FSA, and local investors.  There is a lot of funding available, but we need to train someone to find it and use it to move the real estate market forward.  The buyers are there; however, the money to update the houses and business spaces and ready them for occupancy is not.   

These solutions can all be combined under an umbrella concept known as Land Banks.  These are not the Federal Land Banks that our farmers and ranchers have used for years and still depend on.  These Land Banks are different.  In our final installment next week, the concept of the Land Bank will be examined as it may be a solution that encompasses all the problems causing the situation in which we currently find ourselves.

TO READ PART 1 CLICK HERE
  
 
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