Abandoned Homes or Abandoned Homeowners?

1 Nov

by Ken Davidson

 

Gary IndianaThe Gazette reported on the IHCDA plan to assist Gary and other Cities in the elimination of abandoned homes earlier in the week. You can see that story Here in case you missed it. This is the second in a series of articles examining what got Gary to the point that there are an estimated ten thousand abandoned and vacant homes throughout the city.  Most homes in Lake County are assessed by the County Assessor.  In Calumet Township, that is not the case.  As discussed below, the office of Calumet Township Assessor Jackie Collins is responsible for assessing the values of homes in Griffith, Gary and parts of unincorporated Lake County.

The Mayor attributes the problems in Gary, in part, to the foreclosure crisis. The foreclosure crisis is a national problem that plagues nearly every urban area in the country. Gary, however, was hit less hard by the foreclosure crisis than any other city for two reasons. First, there was never a real estate bubble in Gary, Indiana. There was not a time when homeowners refinanced their homes and took large amounts of cash out because the values never rose rapidly. Second, Gary has a higher rate of homeowners with no mortgage than any other city in Lake County and probably the state.  State Senator Earline Rogers made no  comments regarding the cause of the crisis other than to refer to Indianapolis as the “Hoosier Holyland” which suggested to me that she blamed downstate lawmakers for the problems.

The Mayor and Senator Earline Rogers fail to mention the other likely reasons for the number of abandoned and vacant homes in Gary. We examined the lack of city services in a prior article (you can read that Here ). Lets talk about the taxation issues and how they cause homeowners to flee the city.

First, lets understand how properties are assessed in Indiana. The general assembly passed a law that allowed residents in certain townships to choose to keep or eliminate office of the township assessor. This was done by a referendum in 2008. The overwhelming majority of townships in Indiana who were given the choice eliminated the office of township assessor and county assessors are now performing the duties of assessing those areas in a more efficient manner. The voters of Calumet Township chose to keep their township assessor. That office is currently held by Jackie Collins.

This is the office that has failed to keep the Gary Housing and City of Gary properties off the tax sale rolls even when notified that the parcels are owned by a government agency. The City is now spending tens of thousands of dollars on private attorneys to retrieve hundreds of units that were erroneously taxed and sold. The same office that allegedly used public funds to send out flyers telling Gary residents that they may lose tax credits (statutory tax credits which are provided by the State of Indiana) if they did not vote to keep the office open. And this is the office that is responsible for determining the fair market value of land, buildings and personal property for all of Calumet Township.

Ralston Street was mentioned as one of the streets that received little in the way of City services at the IHCDA meeting, so I thought I would take a look at the tax values on Ralston. If we start at the corner of 24th and Ralston is one of those evil out of town landowners that was discussed by the politicians at the meeting. The home is assessed at $148,900. With a Gary Sanitary District Fee of $60 and a Little Calumet River Basin fee of $45, the total annual tax bill is $5,830.00.

Across the street, still at the corner of 24th and Ralston is an owner occupied home. It is assessed at $58,000 and has a homestead deduction (no mortgage deduction by the way). The total tax was $2008 last year but dropped to about $931.00 this year. There are late fees of $432.17 on a delinquency of about $1100.00 In order to avoid tax sale and stay in this home, the taxpayer had to pay $2067 in the first installment this year. The second installment of taxes due now is $443.39.

As you continue down the block, you finally get to some properties that seem to be properly assessed. INS Incorporated owns a home at the end of Ralston Street that is assessed at $12,000. There are others that show taxes in the range of $700 last year. No explanation as to why one homeowner, on the same block, paid nearly 3 times the tax last year and then was hit with another $432 in penalties.

The wild fluctuations in values from year to year and similar properties together with ever increasing fees have caused many homes in Gary to go to the tax sale. Even at the tax sale many homes remain unsold even for the amount of the delinquent tax. The market is that bad in Gary. People are not even buying homes for $2,000; yet residents are being charged that much and more for one year’s worth of taxes.

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6 Responses to “Abandoned Homes or Abandoned Homeowners?”

  1. Wayne Randall via Facebook November 1, 2013 at 1:41 am #

    keep re-electing these same people and you can pass this insanity on to your grandkids

  2. Anonymous November 1, 2013 at 2:19 am #

    Gary is not the only city in NWI which has forgotten its residents. In Hammond, Mayor Thomas McDermott Jr seems to find money to fund legal clinics, give money to fund a festival, cash to preferred contractors to build homes, and pay consultants $100,000 a year in combined benefits, but what about the residents.

    McDermott did a way with programs to assist low income homeowners to rehab their property.

    http://www.northwestindiana.com/discussionforum/viewtopic.php?f=15&t=10556&sid=1f6cdba473d67f56289b2fb49210728f&start=585

  3. Jim T November 1, 2013 at 6:51 am #

    Earline Rogers, Barack Obama, Harry Reid, Nancy Pelosi, and the rest of the democrats in this country have a standard operating procedure of blaming someone else. Now it is “Hoosier Holyland.” No, the problem is that the fine people of Gary keep electing incompetent political cronies to high office. I lost count of how many Lake County politicians have gone to jail. They were all democrats, no Republicans! I don’t think any of that had to do with “Hoosier Holyland.” Gary is a microcosm of the Socialist experiment much like Detroit. Yet there is a political party that would like the rest of the country to look the same. That party is lead by Barack Hussein Obama.

  4. Anonymous November 1, 2013 at 9:37 am #

    You have summarized the situation correctly. The same problems exist with vacant lots. A vacant lot bought at a tax sale for a few hundred dollars (or less) in order to maintain the neighborhood often results in a valuation of thousands of dollars. If you dare to exercise your rights, you will get nothing but ignorance from the township in the purgatory known as the appeal process. The fraudulent assessments are not just due to incompetence, but also to malfeasance.

  5. Cha Meyer via Facebook November 1, 2013 at 9:35 pm #

    It’s called abandoned legacy city without following the approved sustainable and right sizing/managed growth approved by the citizens, Plan Commission and Common Council in 2007.

  6. Gary Free-Press via Facebook November 2, 2013 at 8:46 am #

    This poses a good “which came first” scenario…

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