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HomeMy WebLinkAbout2009 08 27 Florida Association Code Enforcement - ForeclosuresFlorida Association of Code Enforcement 20th Annual Conference & Training Seminar June 17-20, 2009 Twenty Years, One F.A.C.E. Foreclosures ~~oN of co~A ~~ o F n ,~Q CE .. ,~'' \l~' ~/ Mark Lupe and Frank Cassidy Presented in conjunction with The John Scott Dailey Florida Institute of Government at the University of Central Florida 36 West Pine Street, Suite 204 Orlando, FL 32801 (~ (407) 235-3960 f~uc (407) 317.7751 iog@mail.uc£edu Foreclosures A Code Enforcement Perspective Mark Lupe, Assistant City Attorney Frank Cassidy, Code Compliance Division Manager City of Cape Coral orec osures- o e n orcement Perspective ^ Hc~w we Gat Here ^ fur Current System Can't Handle ]t! ^ A Look Around ^ Compare, Adjust, Develop, Implement © Looking Ahead orec osure5- o e n orcement Perspective How ~Ve Got Here ^ The Market ^ The Nation ^ The Region F C, orec osures- o e n orcement Perspective .;..x= , F ~x: e.i,..M ~ ~. ~. MM y ~~~rhhwq~ ~ ~ ~~. w •~ ~;• ~, ~.. 0 ~. n~r 4Mn. xy ~; Y ~ . { {.~ ~ Y 4,y~n~• ~ wN+~- may, ,t,,;,y . ~ .~,~~, orec osures- o e n orcement Perspective SUPREME COURT'S TASK FARCE -May 8 ^ In three years, Florida's state courts have seen f'areclosure filings increase from 74,000 cases in 200ta to 370,000 in ZQ08, an increase of 400 percent, ^ There has been nn corresponding increase in court infrastructure to accommodate this caseload growth. ^ In some circuits the increase in mortgage f'oreclasures is dramatically higher -the 20th circuit has seen a 788 ercent caseload increase from 2006- 4008 and the l~ih circuit's caseload has increased 631 percent ire the same time period, 2 C, r~ u SUPREME COURT'S TASK FORCE -May 8 ^ National statistics Pram 2UU8 place Florida second in the country in residential mortgage foreclosure case filings according to Uffice ofthe Florida Governor H xecutive Urder Ul3-27, section I .U 1. v The Pew Center's Report's April 2UU~ report Defaulting on the Dream: States Respond to America's Foreclosure Crisis projects that in Florida cane out of Z6 houses will go into foreclosure in 2UUK-?UU9, at a decrease in the average tax baselhause value of approximately $36,U0U. orec osures- o e n orcement Perspective ', _-- ~ ^ Local; ^ 19,475 foreclosures filed Since January ^ Approximately 4U% of foreclosures pending throughout Lee County are in Cape Coral ^ 7,79U in Cape Coral 3 orec osures- e n orcement Perspective Our Current Syst~m Can't Handle it! ^ .Standard Enforcement ^ Chapter 1 b2 -Where are Yoo? ^ The Knock on the Door ^ Non-Compliance ^ "So What?„ ^ Liens and Lis Pendens orec osures- o e n orcement Perspective ^ Challenges: ^ Funds- General Funds or Other Sources ^ Liens: ^ Responsible PartieslOwners Abandoning ^ subordinate to Mortgage r Mortgage Exceeds Sale Price =Our Liens Foreclosed orec osures- e n orcement Perspective A Lvvk Around ^ Areas that Are Number One! ^ What they are Doing ^ Bringing it Hvme ^ Examining our Resources 4 r~ u orec osures- o e n orcement Perspective Compare, Adjust, Develoa, ltnplement ^ Nv Perfect Fit ^ No "Cure All; End All" ^ The Game of Recovery ^ Making itFit- A Continuous Process ^ To Do Nothing's ecommen e esponses y Brookings -May 2008 ^ Mitigate The Effects OfForeclosure On garCOWer5 _ 4 ACtlans Steps ^ Mitigating The Effects Of Foreclosure On Neighborhoods And At-risk Communities - 3 Actions Steps ^ Prevent Future Abuses in The Mortgage Lending System - 2 Actions Steps Mitigating The Effects 0f Foreclosure ^ Mitigating The Effects Of Foreclosure 0n Neighborhoods And At-risk Caminunities ^ Establish Creditor Responsibility To Maintain Vacant Property ^ Fnsure that the property is ultimately conveyed to a responsible owner ^ Make the process as expeditious as possible 5 -1 I orec osures- o e n orcement Perspective ^ New Ordinance: Coral Springs, North Lauderdale, and ethers ^ Require Banks to Inspect Property and to Determine if Vacant andlor Abandoned ^ F..stablishes a Responsible Party ^ Fees & Registration ^ Maintenance Requirements ^ Secure the Property Lender Responses ^ We already have a code compliance system and it applies to owners © We just have a security interest - we can't maintain someone else's property ^ Maker the real estate agents register the REd property orec osures- o e n orcement Perspective !I Laokin r Ahead ^ Unf t Housing Stock © Blight Run A Muck ^ Crime Builds ^ Casts Increase ^ The Burden for Years orec osures- o e n orcement Perspective ~ ^ Looking Ahead: ^ Mowing ^ I3nard Ups ^ Working with Realtors ^ Demolitions ^ Working with other Agencies and Departments orec osures- o e n orcement Perspective ^ V~Ihat are we Doing: ^ Mowing ^ Police and Fire ^ E3oarding Pools and Structures ^ Research and Follow Ups ' ^ Working with Other Agencies Throughout State & Beyond ^ I~ooking for New Ways io Address the Issue - .~____. NUISANCE ABATEMENT ^ ,Attention owners, agents, cu$todians, ieaseea and occupants of real property within the city limits OF THE C'iTY ON PART 5'T, U 'i E: You are hereby notified that you are required by law tv , . , to repair, restore or demaiish any unfit or unsafe structure located upon such prape ;and that upon your failure to do sa, the City of ~ Fort St. l.uc~e w~~institute nuisance abatement proceedings against your property and cause such nuisance to be abated. i'hc cast of such abatement will constitute a special assessment lien against the property an which the nuisance is located. Such special assessment lien shall be coequal with the Tien of ail state, county, district, and municipal taxes and superior in dignity to mortgages and alt other liens, irrespective of the date of the retarding of the municipal lien or the date of the recording of any mortgage or any other lien an real property. A failure to pay said lien, even such lien upon homestead property, may result in a (ass of title to your property. 7 orec osures- AZoi~~nforcement Perspective a Qucstians`~ fra+ci~yfu,cap~w ural. nel ndu~xKaca~ural.rkK ~ ~ ~ ~ Written Testimony Submitted by: Doug Leeper, Code Enforcement Manager Chula Vista, CA Earthquakes, cyclones, tsunamis and hurricanes, we hear of their destructive nature and see their devastating impacts on our evening news. Somewhere in the world people are impacted by these natural disasters daily, We, here in the US, are suffering under an un- natural disaster that is impacting hundreds of thousands of neighborhoods and millions of people --vacant, abandoned, accessible properties, Although the collapse of the housing market and lending industry has been widely reported, the ripple out effect of the collapse has yet to be adequately addressed. There have been discussions on who is to blame and how to prevent this from happening again, but little attention has been paid to the true, innocent victims -the neighbors and local jurisdictions that are left to cope with and clean up the mess. if a ship's captain recklessly pilots his ship into a hazard and spills oil, the damage isn't contained to just the ship. The oil spilled from that ship leaks into and spreads over miles of ocean, beaches and coastline. It seeps into every nook and crevasse. ~t covers every rock, every grain of sand. It coats unsuspecting wildlife and damages the environment far decades to come. Such is the case with the record number of f nancially distressed properties foreclosures} we are experiencing across the Nation, The SS Mortgage has run aground at the hands of reckless captains. The crude ail of foreclosures and abandoned properties has leaked into and spread over the entire country, neighborhood by neighborhood. Unsuspecting residents are being covered in the ail of diminishing home values, blight and unmarketable real estate. They find themselves mired in a situation they didn't create and yet can't free themselves from. With shipwrecks and oils spills, the damage can be minimized by fast action and containment. There are federal, state and local laws that require response crews be trained to react. There are action plans and drills to prepare for the worst. Even with this training and response, the impacts are only "minimized". The damage can't be undone. And when all is said and done, it can take decades to calculate the cost of response, containment and recovery. But, with a single spill, at least there is someone to hold accountable. This is not the case in the situation we f nd ourselves now, this "mortgage meltdown". While ships holds were filled to overflowing with mortgages, some very questionable, loading crews (brokers and originators} were hired in record number, and little, if any, thought was given to training response crews, preparing action plans or conducting drills. In short they didn't prepare for this disaster, they didn't feel they needed to If a gallon or two of oil sloshed over the gunwales there would be someone there to scoop it up. In real estate terms, you could always "flip it", sell the house or mortgage, and save yourself from the "spill". You could, that is, until too much of the oil spilled over at once and there was no one there to scoop it up anymore. 9 This all could have been avoided, and even still the damage can be minimized, the spilled oil can be contained. But the benef ciaries of these mortgages blenders, securities and trusts} claim they aren't responsible but are the victims, after all it's their ships that have been damaged. They aren't looking at the oil they have spilled onto unsuspecting bystanders living next door to or across the street from THEIR financially distressed abandoned properties. A select few groups saw the impending collapse and attempted to prepare for the negative impact it would have. The City of Chula Vista was among those few groups. Realizing the City had seen unprecedented growth and housing sales, as well as a record increase in median valuation, City officials recognized their vulnerability to numerous foreclosed abandoned properties in the near future. Staff had experienced the non-reactive nature of the mortgage industry during the housing downturn of the early 199~'s and drafted a pro- active abandoned property registration and maintenance ordinance that sought to minimize the negative impact these conditions bring. See Attachment "A" The ordinance was unique, in that it wasn't based on the physical condition of the property alone but the contractual condition of the mortgage as well. Let me explain. In most states the lenders are required to file orrecord defaultlpre-foreclosure documents with the county in which the subject property is situated.. The lender then must wait for a court date or, in non judicial circumstances, ogre-determined number of days, before proceeding with the notice of foreclosure sale. In California it is 9~ days. In many instances, the properties subject to the filings and recordations are vacant and abandoned during this "warning period." After their court date, or the expiration of the mandatory time frames, the lender must f le or record additional notices and advertise the pending foreclosure sale. In California this recordation and advertising must take place a minimum of 21 days prior to the actual sale. As stated before, many of the homes are vacant and abandoned during this period. It is during this time period, a minimum of four months in California, that a large majority of these vacant properties become the ratting tooth of the neighborhood smile as they are left to the elements and whims of passersby, vandals, thieves and the like. It is also during this time period that lenders claim they can't take ANY action on the property because they don't own it yet .. , it hasn't gone through foreclosure sale. They overlook the covenants within their mortgage contract that provide them that very right. This covenant is commonly referred to as an "Abandonment and Waste Clause" and in short it states that if the borrower stags making the mortgage payments and moves out of the house, leaves it vacant, the lender may access the property to secure it from vandalism, deterioration and waste. The borrower agreed to this condition upon signing the mortgage contract. There are some restrictions on the lenders in these actions. They may not remove, alter or destroy the structure. They may take action as maybe reasonably i~ necessary to prevent unauthorized entry ire-keying locks, replacement of doorslwindows, boarding, etc.}. They may maintain landscaping, pools and fences. They must inventory and store any personal items they remove from the property. They cannot market or rent the property. And they may not deny the borrower access if they return and request it. So, if lenders have the right to protect their investment, the house, why don't they? After all, they claim that they desire the same things the cities do, safe and stable neighborhoods. The short answer is money. In more detail there are about seven main reasons: l . They hope the borrower remedies the default and makes up all the back payments and fees. 2. They hope property will sell prior to the foreclosure sale. 3. They hope to sell the mortgage to another lender. 4. They hope they are outbid at the foreclosure sale. 5. They hope the local jurisdiction will maintain the property for them. G. They don't want to risk potential litigation from the borrower. 7. They have insurance that covers damage caused to the property prior to the foreclosure sale. This damage is sometimes referred to as "Mortgagor Abuse." Chula Vista's new ordinance compels the lender or beneficial interestJmortgage holder exercise the abandonment clause in their contract. It simply states that upon recording a Notice of Default ~pre•foreclosure action} the lender m inspect the property for occupancy. if the property is found to be vacant, the lender must register the property with the City and then begin to maintain the property to the neighborhood standard. Why must the lender register the property with the City? There is an additional problem in the lending industry beyond the collapsing housing market and avalanche of foreclosures we are experiencing. The problem is difficult to explain but has a simple remedy. The problem is an inability of local authorities to locate the current benef ciary of the mortgageldeed of trust. Mortgage brokers and lenders buy, sell and trade mortgage loans like baseball cards and Halloween candy. They always notify the borrower where to send their payments but rarely record the substitution of beneficiary or assignment of rents with the county to provide notice to anyone, such as a code enforcement department, that may need to communicate with the lender. When local officials review the title documents, in an attempt to locate a responsible party, quite often they are met with this outdated information that results in disconnected phone lines and dead ends. See Att~cbmen~ "C" Be~eficial~~st Transfer Detail Although recordation of these one or two page documents would save government agencies countless hours and thousands of dollars in forensic research, at a minimal cost to the lender, most counties charge $10-~20 to record such documents, many lenders claim it is "cost prohibitive." Most states allow for the recordation of these documents but do not require them. There is an alternative to recording these documents with the county. The Mortgage Electronic Registration System ~MERS} is an Internet database that is accessible to all lenders, It works very much Like the DMV. Each new mortgage is issued a Mortgage ldentitxcation Number or MIN. Much like a Vehicle identification Number (VIN}, no two are al ike and they stay with the vehicle, in this case the mortgage, for its duration. The MIN is listed on the original mortgage which ALWAYS gets recorded} making it accessible to local authorities as a public record. if the mortgage is sold, transferred or otherwise taken over, the previous beneficiary can release their interest electronically on the database and list the new beneficiary or in the reverse the new beneficiary can register their interest electronically minimizing the need for local recording. This type of registration removes the lender's argument that recording such information ~dacuments} is slow and "cost prohibitive" as the electronic registration is live and can be preformed from anywhere in the world. Armed with an original mortgage document, the local authority can access the MFRS web-site, free of charge, and input. the 17 digit MIN number. The database then provides the current beneficiary, their address and contact information. With current information code enforcement officers can communicate with the current beneficiary through issuance of a Notice of Violation and by phone in many cases. The faster the beneficiary is contacted, the faster the problem can be resolved and the faster we stabilize the neighborhood. For far too long the lenders have abdicated their property managementlmaintenance responsibility and, by their inaction, transferred t ~' job to the local authorities. Lenders were content to let code enforcement secure their properties, remove their trash, paint out their graff ti and even mow their lawns. Although most local jurisdictions have the authority and can perform these tasks summarily or under warrant, most cities, small and large, do not have the staff nor budget for such activities. Most jurisdictions send a bill for these services to the last known responsible party, but as stated above, rarely are these documents current. Some jurisdictions have the ability to lien the property for outstanding debts but in many states these liens are eliminated at the foreclosure sale. . With that in mind the new ordinance also requires that lenders retain the services of a local property managerlmaintenancecompony and that the company's name and contact phone number be visibly posted on the property. The posting serves several purposes. It removes the city from its position as de facto property manager and allows anyone that observes a problem at the property direct contact with an entity that can respond and address the issue. The problems we have been experiencing are wide and diverse. in the worst cases children are abducted, raped and murdered. Bad things happen in vacant properties! Some are targets for arson and insurance fraud. Theft and vandalism are the most obvious. Homes have been stripped of appliances, cabinets and carpet. With record prices being paid for scrap copper and aluminum, wiring and plumbing are almost irresistible to these thieves. Entrepreneurial college and high school students have, through the Internet, found a way to turn these vacant abandoned homes into makeshift one-shot nightclubs. ~on~artists are advertising these homes for rent to unsuspecting families who pay thousands of dollars in cash only to find out they have no right to be in the home. Teenagers and gangs have taken over Names and trashed them, nearly beyond repair. But, 12 all this is the "banks" loss, right`? VWhile on the surface it may seem so, the real cost is passed on the local community through increased calls for police and emergency services and reduced property values and marketability. Although the lenders maintain insurance on these properties, and receive settlement checks on a regular basis, these vandalized properties are rarely repaired to a marketable "move in condition" but are Bald "as is" at a highly reduced rate. This practice lowers the comparable values of the remaining properties in the neighborhood. The reduction in neighborhood livability, value and marketability only serve to set the stage for more foreclosures, a self fulfilling prophecy. The US Conference of Mayors, HUD, VA and several other organizations have reported that DNE of these vacant abandoned properties has a negative financial impact on the surrounding community up to 118 of a mile away. The negative impact is multiplied when the number of these properties increases. In some neighborhoods we have already seen as many as one in f ve properties fall into this status. As these properties deteriorate the visual impact can lead to discouragement of neighboring property owners, who can begin to neglect their own properties. Blight breeds blight. Armed with this information and a new ordinance, the City of Chula Vista hoped to minimize the negative impact in its neighborhoods, to stop the bleeding. At Iirst officials were told, by the lendinglforeclosure industry, that they couldn't pass or enforce such a law. The city moved forward. Soon aver they were informed that the lending industry would fight the law, They did nat. Next, they were informed that no one in the lending industry would follow the ordinance. The City began to issue notices and monetary penalties. The lenders started to take note. The new ordinance has gained notoriety and cities from all over the Nation have contacted the City asking far background information and examples. To date the City has received nearly 200 inquiries from other jurisdictions. As some of these cities began to pass similar ordinances, and Chula Vista continued to issue f nancial penalties, the lending industry, although reluctantly, began to respond. Dne sign that the City had gained their attention came in the way of a phone call to the Code Enforcement Manager at his home on a weekend. A high level representative of the lendinglforeclosure industry informed him that he was, "making too much fucking noise" with the ordinance. Soon after, some lenders began to make contact with the City, in some cases sending representatives toCalifornia to discuss the ordinance and how they could best meet the compliance standards. &~:`~ List of ~nteres~d_~i~es The City of Chula Vista has the highest foreclosure rate in San Diego County with an estimated 1,000 to 1,500 RED's foreclosures} and an additional 2,000+ recorded defaults ~pre~foreclosures}. It is estimated that all the RED's and approximately 113 of the recorded defaults are vacant. That is a total of over 2, l 00 vacant abandoned properties. Although the ordinance authorizes staff to be proactive and inspect every recorded default and RED, staffing levels don't allow far such activity. Officers are reactive and respond to resident complaints of vacant abandoned properties. Currently there are 450 properties registered in the program. About 10% (45} of those are in violation of the maintenance andlor posting sections of the ordinance. Dn the other hand we have noted several properties that are incompliance with the ordinance, clean, green, secure and 13 posted, but not registered. These properties ARE NOT a priority with the staff. The City is less concerned with collecting the registration fee than the elimination of visual blight and attractive nuisances. Staff currently has approximately 1 Dfl open reactive cases in process. Additional staff and funding sources were not available at the implementation of the program. initially, 20% of existing reactive staff was assigned to the program. Recently we have increased that percentage as the number of foreclosures has accelerated. To date the program has generated $31,SDD in revenue through registration fees x$70 per property}. An additional $154,979 has been assessed in f nes, penalties and full cost recovery. Of that, $5,519 has been collected the remaining $129,46U has been recorded as special assessment liens with the County Tax Assessor's Office. The total revenue received to date, $57,019, has nearly covered the cost of the program. There were three challenges faced as the program was implemented: l . Notifying a multi national lending~foreclosure indusi~ry of a local ord~naneelprogram. -Response -The Code Enforcement Manager had previously been involved with the lendinglforeclosurelloan and field servicing industry and had contacts within many of the national organizations such as the Mortgage Bankers Association, Real Estate Owned Management Association of California and the United States Foreclosure Network. With this information, getting the word out was not difficult. 2. Locating the current beneficiary of the mortgage on a property that was in violation. - Response ~-This remains one of the single largest obstacles in dealing with financially distressed properties. Often mortgage loans are issued and then the beneficial interest is sold to another companyllender, security or trust and that transfer is not recorded. Without a recorded transferor substitution of beneficiary the local jurisdiction has noway to contact the individual or corporation that has authority over the property. The time spent in research and phone calls attempting to track down the current beneficiary is crippling. Note: The California State Assembly is currently reviewing a bill that would make recordation of such changes mandatory. 3. Adequate staffing. -Response - 40% of the reactive code enforcement staff two off cers) have been assigned to respond to vacant abandoned financially distressed properties only. We have enlisted the assistance of our building inspectors. They monitor the registered properties for continued compliance and notify the code enforcement officers of violations. Other less urgent issues have been placed on a "Service Reduction List" of items we are currently unable to respond to. Admittedly this has the potential to create a backfire effect if the foreclosure crisis is prolonged. Although there remains a vacant abandoned property issue within the City of Chula Vista, and vacant abandoned unmaintained properties can be seen in many neighborhoods, the negative impacts are being greatly reduced, as lenders understand there are serious financial consequences to non-compliance. Through this process we have learned that enforcement CAN reduce the negative impact these properties create. it is only when the cost of inaction, f nes and penalties, are greater than the cost of proper 14 maintenance and security that the lenders will "do the right thing" and pro-actively maintain the properties that THEY ARE RESPONSIBLE FOR. i~ 15,~b0.010 PURPOSI~~~,~ It is the purpose and intent of the Chula Vista City Council, through the adoption of this Chapter, to establish an abandoned residential property registration program as a mechanism to protect residential neighborhoods from becoming blighted through the lack of adequate maintenance and security of abandoned properties. 15.b0.02 DEFINITIONS For the purposes of this chapter, certain words and phrases used in this chapter are defined as follows: l5 "A~,andor~ed" means a property that is vacant and is under a current Notice of Default andlor Notice of Trustee's Sale, pending Tax Assessors Lien Sale andlor properties that have been the subject of a foreclosure sale where the title was retained by the beneficiary of a deed of trust involved in the foreclosure and any properties transferred under a deed in lieu of foreclosurelsale. "Ac essible nro~t " means a property that is accessible through a compromisedlbreachedgote, fence, wall etc.. " " means a structurelbuilding that is unsecured andlor breached in such a way as to allow access to the interior space by unauthorized persons, " "means any agreement or written instrument, which provides that title to residential property, shall be transferred or conveyed from one owner to another owner after the sale, trade, transfer or exchange. " " means an instrument that transfers the beneficial interest under a deed of trust from one lenderlentity to another. "B fi ' " means a lender under a note secured by a deed of trust. ".B~" means any persan, cv-partnership, association, corporation, or fiduciary who agrees to transfer anything of value inconsideration for property described in an agreement of sale, as defined in this subsection. "Dan r in "means any buildinglstructure that is violation of any condition referenced in CVMC Chapter 15.18. "Dad," means consecutive calendar days. "D f T "means an instrument by which title to real estate is transferred to a third party trustee as security for a real estate loan. Used in California instead of a mortgage. This definition applies to any and all subsequent deeds of trust i.e.: 2nd trust deed, 3'~ trust deed, etc. "De in lieu of forecla~~r~(~~;1~" means a retarded document that transfers ownership of a property from the trustor to the holder of a deed of trust upon consent of the beneficiary of the deed of trust. "~1" means the failure to fulfill a contractual obligation, monetary or conditional. "Di r " means a property that is under a current Notice of Default andlor Notice of Trustee's Sale andlor pending Tax Assessor's Lien Sale or has been foreclosed upon by the trustee or has been conveyed to the beneficiaryltrustee via a Deed in lieu of Foreclosurelsale. "Ey'dence of vacancy" means any condition that on its own, or combined with other conditions present would lead a reasonable persan to believe that the property is vacant. u 16 Such conditions include but are not limited to, overgrown andlor dead vegetation, accumulation of newspapers, circulars, flyers andJor mail, past due utility notices andlor disconnected utilities, accumulation of trash, junk andlor debris, the absence of window coverings such as curtains, blinds andlor shutters, the absence of furnishings andlor personal items consistent with residential habitation, statements by neighbors, passersby, delivery agents, government employees that the property is vacant. "F r 1 sur "means the process by which a property, placed as security for a real estate loan, is sold. at auction to satisfy the debt if the trustor ~borrower~ defaults. "~" means within forty X40} roadldriving miles distance of the subject property. "N i "means those conditions that are present on a simple majority of properties within a three hundred X300} foot radius of an individual property. A property that is the subject of a neighborhood standard comparison, or any other abandoned property within the three hundred X300} foot radius, shall not be counted toward the simple majority. "Notice of Default" means a recorded notice that a default has occurred under a deed of trust and that the benef ciary intends to proceed with a trustee's sale. "~ fare "means in excess of forty X40} roadldriving miles distance of the subject property. " wn r" means any person, co-partnership, association, corporation, or fiduciary having a legal or equitable title or any interest in any real property. "owner of record" means the person having.recordedtitle to the property at any given point in time the record is provided by the San Diego County Recorders Office. "P~cr ,~e~,,y" means any unimproved or improved real property, or portion thereof, situated in the city and includes the buildings or structures located on the property regardless of condition. "R i n i 1 ' 1 ' "means any improved real property, or portion thereof, situated in the city, designed or permitted to be used far dwelling purposes, and shall include the buildings and structures located on such improved real property. This includes any real property being offered for sale, trade, transfer, or exchange as "residential" whether or not it is legally permitted andlor zoned far such use. " "means such measures as may be directed by the Director of Planning and Building or his or her designee that assist in rendering the property inaccessible to unauthorized persons, including but not limited to the repairing of fences and walls, chaininglpad locking of gates, the repair or boarding of door, window andlor other openings. Boarding shall be completed to a minimum of the current HUD securing standards at the time the boarding is completed ar required. "Trustee" means the person, firm or corporation holding a Deed of Trust on a property. 17 "Trustor" means a borrower under a deed of trust, who deeds property to a trustee as security for the payment of a debt. "Vacant" means a buildinglstructure that is not legally occupied. 15 60 030 RECORDATION OF TRANSFER OF LOAN/DEED OF TRUST/ASSIGNMENT OF RENTS Within ten ~ 10} days of the purchase andlor transfer of a loanldeed of trust secured by residential property the new beneficiaryltrustee shall record, with the San Diego County Recorders office, an Assignment of Rents, or similar document, that lists the name of the corporation, andlor individual, the mailing address and contact phone number of the new beneficiaryltrustee responsible for receiving payments associated with the loanldeed of trust. 15.60. RE I T TI N Any bene~ciaryltrustee, who holds a deed of trust on a property located within the City of Chula Vista, shall perform an inspection of the property that is the security for the deed of trust, upon default by the trustor, prior to recording a Notice of Default with the San Diego County Recorders Office. If the property is found to be vacant or shows evidence of vacancy, it is, by this chapter, deemed abandoned and the benef ciaryltrustee shall, within ten ~ 10} days of the inspection, register the property with the Director of Planning and Building or his or her designee on forms provided by the City. If the property is occupied but remains in default it shall be inspected by the benef ciaryltrustee, or his designee, monthly until 1 }The trustor other or party remedies the default or 2} It is found to be vacant or shows evidence of vacancy at which time it is deemed abandoned, and the trustee shall, within ten ~ 10} days of that inspection, register the property with the Director of Planning and Building or his designee on forms provided by the City. In either case the registration shall contain the name of the beneficiaryltrustee corporation or individual}, the direct streetloffice mailing address of the bene~ciaryl trustee (no P. 4. Boxes, a direct contact name and phone number for the beneficiaryltrustee and, in the case of a corporation or out of area beneficiaryltrustee, the local property management company responsible for the security, maintenance and marketing of the property. Registration fees will not be prorated. An annual registration fee shall accompany the registration form. The fee and registration shall be valid for the calendar year, or remaining portion of the calendar year, in which the registration was initially required. Subsequent registrations and fees are due January 1'` of each year and must be received no later than January 31 of the year due. This section shall also apply to properties that have been the subject of a foreclosure sale where the title was transferred to the beneficiary of a deed of trust involved in the foreclosure and any properties transferred under a deed in lieu of foreclosurelsale. 18 Properties subject to this~chapter shall remain under the annual registration requirement, security and maintenance standards of this section as long as they remain vacant. Any person, firm or corporation that has registered a property under this chapter must report any change of information contained in the registration within ten ~ 10) days of the change. 1 M AN E T Properties subject to this section shall be, in comparison to the neighborhood standard, kept free of weeds, dry brush, dead vegetation, trash, junk, debris, building materials, any accumulation of newspapers, circulars, flyers, notices, accept those required by federal, state or local law, discarded personal items including but not limited to, furniture, clothing, large and small appliances, printed material or any other items that give the appearance that the property is abandoned. The property shall be maintained fine of graffiti, tagging or similar markings by removal or painting over with an exterior grade paint that matches the color of the exterior of the structure. Visible front and side yards shall be landscaped and maintained to the neighborhood standard at the time registration was required. Landscape includes, but is not limited to, grass, ground covers, bushes, shrubs, hedges or similar plantings, decorative rock or bark or artif cial turflsod designed specifically for residential installation. Landscape does not include weeds; gravel, broken concrete, asphalt, decomposed granite, plastic sheeting, mulch, indoor~outdoor carpet or any similar material. Maintenance includes, but is not limited to regular watering, irrigation, cutting, pruning and mowing of required landscaped and removal of all trimmings. Pools and spas shall be kept in working order so the water remains clear and free of pollutants and debris or drained and kept dry. In either case properties with pools andlor spas must comply with the minimum security fencing requirements of the Sate of California. Adherence to this section does not relieve the beneficiaryltrustee or property owner of any obligations set forth in any Covenants Conditions and Restrictions andlor Home Owners Association rules and regulations which may apply to the property. 15.60.060 SECURITY REQUIREMENTS Properties subject to this section shall be maintained in a secure manner so as not to be accessible to unauthorized persons. Secure manner includes but is not limited to the closure and locking of windows, doors walk-through, sliding and garage} gates and any other opening of such size that it may l9 allow a child to access the interior of the property and or structure(s). In the case of broken windows securing means the reglazing or boarding of the window. If the property is owned by a corporation andlor out of area beneficiaryltrusteel owner, a local property management company shall be contracted to perform weekly inspections to verify that the requirements of this section, and any other applicable laws, are being met. The property shall be posted with dame and 24-hour contact phone number of the local property management company. The posting shall be no less than 1 S" X 24" and shall be of a font that is legible from a distance of forty-f ve ~45~ feet and shall contain along with the name and 24-hour contact number, the words "THIS PROPERTY MANAGED BY" and "TO REPORT PROBLEMS OR CONCERNS CALL". The posting shall be placed on the interior of a window facing the street to the front of the property so it is visible from the street, or secured to the exterior of the buildinglstructure facing the street to the front of the property so it is visible from the street or if no such area exists, on a stake of sufficient size to support the posting in a location that is visual from the street to the front of the property but not readily accessible to vandals. Exterior posting must be constructed of and printed with weather resistant materials. The local property management company shall inspect the property on a weekly basis to determine if the property is in compliance with the requirements of this chapter. 1 .60. 70 AD T In addition to the enforcement remedies established in Chapters 1.20,1.30 and 1.41, the Director of Planning and Building or his or her designee shall have the authority to require the beneficiaryltrusteelowner andlor owner of record of any property affected by this section, to implement additional maintenance andlor security measures including but not limited to, securing anylall door, window or other openings, .installing additional security lighting, increasing on-site inspection frequency, employment of an on-site security guard or other measures as may be reasonably required to arrest the decline of the property. 15.60..0$0 FEES The fee for registering an Abandoned Residential Property shall be set by resolution of the City Council. 15.60.90 ENFORCEM NT Violations of this chapter may by enforced in any combination as allowed in Chapters 1.20, 1.30 and 1.41. 15.60. l ~ APPEALS Any person aggrieved by any of the requirements of this section my appeal insofar as such appeal is allowed under Chapter 1.40. 15,~60~ 1 ~0 VIQLATIONIPENALTY 20 Violations of this chapter shall be treated as a strict liability offense regardless of intent. Any person, firm andlor corporation that violates any portion of this section shall be subject to prosecution andlor administrative enforcement under Chapters 1.~0 and I.4 ~ . ~ b .l EV I Should any provision, section, paragraph, sentence or word of this chapter be determined or declared invalid by any final court action in a court of competent jurisdiction or by reason of any preemptive legislation, the remaining provisions, sections, paragraphs, sentences or words of this chapter shall remain in full force and effect. Att~chme~t "~".,, California} • Mortgage issued ~ 1 S` missed payment - "late" ~ 2na missed payment -~ "delinquent" ~ 3ra missed payment - "seriously delinquent" ~ Notice orDefault--1St step in foreclosure ~ Sale Notice - • Sale - 30 days 60 days 90 days 120 days 141 days minimum This is the timeline IF the lender is organized and has not lost track of their inventory. Most lenders are overwhelmed which leads to a much longer process. ~t • Although the borrower, or tenant, may remain in the home throughout this process we have noted that approximately 1/3 of the properties in this process are vacant prior to the completion of the foreclosure. hme~t "~" ,_ • Mortgage broker issues a real estate loan to an individual. • Mortgage broker records Deed of Trust w/county. • Mortgage broker sells the loan to a larger mortgage company. • Larger mortgage company packages several loans and resells to another company. • New company repackages some of the loans and offers them to an investment company as a mortgage backed security or investment trust. • They are then traded on the open market. • Investor hires a "loan servicer" to accept loan payments and communicate with the harrower but servicer has little to no authority over property. • Borrower defaults. 22 • • Servicer processes default/foreclosure for investor but still has no authority over property. • During the foreclosure process the home is abandoned, deteriorates and becomes a nuisance. • Code enforcement pulls the title records from the county but the Deed of Trust lists the original mortgage broker as the beneficiary. • Code- officer calls the mortgage broker, who advises the loan was sold to another company months or years ago and has no interest in the property OR the mortgage broker is no longer in business and there is no answer. • The Notice of Default lists the servicer. • Code officer calls the servicer, they advise they are "just the servicer" and have no authority over the property and will not provide current beneficiary info. • Contact is attempted with the subsequent lenders/investors if known but without their internal tracking #'s they can't locate the property in their records. • Property sits in limbo, abandoned with no maintenance or security for 4-12 months until the current beneficiary of the Deed of Trust realizes they own the asset. ~~'V~;~~! ~er~c~erfinv~s~or s~~~~i~l~~l recurcl their interest ~rit~~ the cou~~t~ or ~~ I:: P.S For more information on the MERS Mortgage Electronic Registration Systems go to the following link www.mersinc.or~ or go directly to the servicer identification page at l~tt s:llwww.mers-servicerid.or lsisf 23 Attachm~n~ "1~" r r r , ~alifor~a ~i Alameda- American Canyon-Anaheim-Antioch-Applew Valley-Arcadia- Azusa-Bakersfield-Baldwin Park-Banning-Beaumont-Bellflower-Belmont- Big Bear Lake-Brentwood~Buena Park-Cathedral City-Canyon Lake-Chico- Chino-Chino Hills-Claremont-Colton-Compton-Costa Mesa-Davis-Desert Hot Springs -Downey-Dublin-El Cajon-Elk Grove-Emeryville-Escondida- Folsom-Fontana-Fremont-Fresno-Garden Grove-Hayward-Hemet-Hollister- HuntingtonBeach-Imperial -Indio-La Palma-Laguna Hills-.Lake Ellsinore- Lancaster-Lincoln-Livermore-Los Angeles-Milpitas-Modesto-Monrovia- Moreno Valley-Montclair-Murrieta-Napa-National City-Norwalk-Dakland- Gntario-Gxnard-Palm Desert-Palm Springs-Paramount-Perris-Pittsburg- Pomona-Rancho Cucamonga- Rancho Mirage-Red Bluff-Redlands- RedwoodCity-Rialto-Riverside-Rocklin-Roseville-San Bruno-San Jacinto- San Juan Capistrano-San Leandro-San Fernando-San Mateo-San Marcos- San Pablo-Santa Ana-Santa Manica-Santa Rose-Santee-Seaside-Stanton- 24 • Stockton-Southgate-Suisun City-Temecula-Tracy-Tulare-Union City- Upland-Vacaville-Vallejo-Victorville-Vista-West Covina- West Hollywood California Counties Amador CO-Butte CO-Orange CO-Placer CO-Sacramento CO-San Bernardino CO-San Diego CO-Riverside CO Other Interested Jurisdictions AZ Avondale-Chandler-Mesa CO Longmont FL Clearwater-Coral Gables- Miami-Dade GA Duluth IL Aurora-Chicago-Kanakakee-Round Lake- University Park-Waukegan-Warrenville-Zion-Villages of Addison- Bannockburn- Bolingbrook-Cary-Carol Stream-Carpentersville-Downers Grove-Glendale Heights-Highland Park-Hillside-Lake Bluff-Lombard- Matteson-Oak Park-Orland Hills-Oswego-Park Forest-Palitine-Petone- Plainfield-River Forest-Romeroville-Roselle-Skokie-Suger Grove-Tinley Park-West Dundee-Wood Dale IN Vincennes-South Bend KY Louisville MA Boston-Lawrence-Springfield-Rochester MO Lees Summit NJ Voorhees NY New York NV Las Vegas-Nevada County-Reno OH Clayton-Dayton-Lakewood RI Westerly TN Memphis TX Dallas-Garland WI Kenosha-Milwaukee . US HUD - VA Washington DC 25 Florida Senate - 2009 SB 1044 By Senator Smith 29-~01388-~09 20091044 1 A bill to be entitled 2 An act relating to public records; providing an 3 exemption from public-~records requirements for 4 specified identifying information contained in the 5 statewide Internet registry maintained under the 6 Vacant or Abandoned Real Property Registration, 7 Maintenance, and Foreclosure Reporting Act; providing 8 exceptions; providing for future review and repeal of 9 the exemption; providing a statement of public 10 necessity; providing a contingent effective date. 11 12 Be It Enacted by the Legislature of the State of Florida: 13 14 Section 1. Statewide Internet re istr maintained under the 15 Vacant or Abandoned Real Propert Registration, Maintenance, and 16 Foreclosure Reporting Act; ublic-records exemption.- 17 ~1} The followin information filed in the statewide l8 Internet re istr maintained under the Vacant or Abandoned Real 19 Propert Re istration, Maintenance, and Foreclosure Re ortin 20 Act is confidential and exem t from s. 119.07 ~l} and s. 24 ~a}, 21 Art. I of the State Constitution: 22 ~a} The name of the owner of the property that is the 23 subject of the filing. 24 fib} The address of the ro ert that is the subject of the 25 filing. 26 ~c} The mort a e loan number of the ro ert that is the 27 subject of the filing: 28 ~2}~a} The information made confidential and exempt under 29 subsection ~1} may be made available to a state agency, the Page 26 CODING: Words rs~ are deletions; words underlined are additions. Florida Senate - 2009 SB 1044 29-01388--x9 20091044 30 lender, or the local government in which the ropert is 31 located. 32 fib} The Department of Financial Services ma use the 33 film sin the re istr to rovide statistical information 34 concernin vacant or abandoned ro ert and ro ert 35 foreclosures . 36 ~3} This section is sub'ect to the o en Government Sunset 37 Review Act in accordance with s. 119.15, and shall stand 38 repealed on October 2, 2014, unless reviewed and saved from 39 repeal through reenactment b the Legislature. 40 Section 2. Because mart a e foreclosures and the man 4l roblems that arise as a result of foreclosures have become a 42 roblem both nationall and articularl in the State of 43 Florida, a statewide Internet registry was created under the. 44 Vacant or Abandoned Real Property Registration, Maintenance, and 45 Foreclosure Reporting Act for the purpose of helping the state,~~ 46 local governments, and mort a e lenders address the roblems 47 inherent in the increase of vacant and abandoned ro erties 48 throu bout the state. B establishin the re istr as a sin le 49 source that will facilitate the com ilation, re ortin , and 54 exchange of information relevant to foreclosures, the relevant 51 parties in property foreclosures will be better able to 52 communicate with each other concerning the roblems related to 53 such vacant and abandoned ro erties. This ca abilit will hel 54 reduce the ne ative im act that increasin numbers of foreclosed 55 properties have on neighborhoods and communities throughout the .. -- 56 state. Issues concerning the maintenance of such properties are 57 better addressed at earlier stages, before the properties begin 58 to have a detrimental effect on neighborhoods and communities, r~ u Page 27 CEDING: Words ~z=i~1r~ are deletions; words underlined are additions. Florida Senate -~ 2009 SB 1044 29-01388-09 20091044 59 and the statewide reaistrv will enable all relevant parties to a 60~ foreclosure to act in a timely manner and thus avoid or_minimize 61 such effects. Under Florida law, the statewide registr would be 62 subject to the state's ublic-records law and an one could 63 obtain the information contained in the re istr This level of 64 access has the otential to rovide criminals with s ecific 65 information about vacant or abandoned ro ernes, thus makin 66 the properties more susceptible to robbery, bur lar vandalism, 67 or other misuse. B making such information publicly available, 68 any resultant robbery, burglary, vandalism, or other misuse of 69 such un rotected ro ernes would be tom letel contrar to same 70 of the primary purposes of establishing the registry, namely, to 71 rotect ro ernes from ne lect and misuse and to increase the 72 general safety and qualit of life of nei hborhoods and 73 communities throughout the state. Under the rovisions governing 74 the registry, the name of the owner of a subject ro ert and 75 the address and mort a e loan number of such ro ert would le to state agent-ies, the mort age lender, and 76 still be availab, -_-- ~ ,~~,_,~,. 77 the local government in which the subject ro ert is located. 78 It is therefore the finding of the Legislature that it is in the 79 best interests of the state that the name of the owner of a 80 property that is the subject of a filing in the statewide 81 Internet registry created under the Vacant or Abandoned Real S2 Propert Registration, Maintenance, and Foreclosure Re ortin 83 Act and the address and the loan number of the ro art that is 84 the subject of the filing be held exem t from ublic-records 85 requirements. 86 Section 3. This act shall take effect July 1, 2009, if SB 87 or similar legislation is adopted in the same legislative r~ u Page 28 CODING: Words ~~-r;~ e~ are deletions; words underlined are additions. Florida Senate - 2009 SB 1044 • 29-01388-09 20091044 88 session or an extension thereof and becomes law. • • Page 29 C4DINC: Wards ~~~~i~ce~ are deletions; words underlined are additions. FLORIDA--Single Family-Fannie MaelFreddie Mac UNIFORM INSTRUMENT Form 3~1a 1101 9. Protection of Lender's Interest in the Property and Rights Under this Security Instrument. If 4a} Borrower fails to perform the covenants and agreements contained in this Securi#y Instrument, ~b}there is a legal proceeding that might significantly affect Lender's interest in the Property andlor rights under this Security Instrument such as a proceeding in bankruptcy, probate, for condemnation or forfeiture, for enforcement of a lien which may attain priority over this Security Instrument or to enforce laws or regulations}, or ~c} Borrower has abandoned the Property, then Lender may do and pay for whatever is reasonable or appropriate to protect Lender's interest in the Property and rights under this Security. Instrument, including protecting andlor assessing the value of the Property, and securing andlor repairing the Property. Lender's actions can include, but are not limited to: ~a} paying any sums secured by a lien which has priority .over this Security Instrument; ~b}appearing in court; and ~c}paying reasonable attorneys' fees to protect its interest in the Property andlor rights under this Security Instrument, including its secured position in a bankruptcy proceeding. Securing the Property includes, but is not limited to, entering the Property to make repairs, change locks, replace or board up doors and windows, drain water Pram pipes, eliminate building or other code violations or dangerous conditions, and have utilities turned on or off. Although Lender may take action under this Section 9, Lender does not have to do so and is not under any duty or obligation to do so. It is agreed that Lender incurs no liability for not taking any or all actions authorized under this Section 9. Any amounts disbursed by Lender under this Section 9 shall. become additional debt of Borrower secured by this Security Instrument. These amounts shall bear interest at the Note rate from the date of disbursement and shall be payable, with such interest, upon notice from Lender to Borrower requesting payment. If this Security Instrument is on a leasehold, Borrower shall comply with all the provisions of the lease. If Borrower acquires fee title to the Property, the leasehold and the fee title shall not merge unless Lender agrees to the merger in writing. ~~tt ~~if~~~~~.~~~rl~fer~~~~.c~~r~i~~ifr~r~~~~d~ac~l~~acume~~t~r'~~Cil~str~~~I~tsida~i3~~Q~.c~~c} Sunday, May 37 , 2409 30 Frvm: Dee Carper ~mailto:DCarper@l"Icities.com] Sent: Mon 4~2,0~2009 9.58 AM Subject: Bad Amendment to Foreciosed~Ahandon Properties C;ond ~tc~rnin~; l~c~cal C;overnment l.ol7l~yists/ FAIR iti~lembers: ?~Ian~~ cities & cr~unties have taken action through lr~cal ordinances that provide local officials with increased authc}ring to enter properties and take corrective action. ()then local governments lave enacted ordinances that increase the abilityr of local code caff~cials to secure blighted structures and place liens on the properties for reimbursement r.~f monies spent to mitigate. An attempt to preempt cities and counties from enacting and enforcing ordinances, resolutions and rules which will require the holder of a mortgage lien on property, to maintain, secure or protect the property prier to foreclosure (at.the time the mortgage holder has acquired title c.~f the property) is underway lay the banking and mortgage industries! .. %i i~,~f ~f.r.-..•a~~,s }~~14 ^` l..I~y.k%*.,'~a ~•~:"i~. L,eS..i' ~i~.~.~,., ~..~~~'~°f~~,d.~~~B.~.AT~:. S~.' [~~~ ~,l<~.ztq`ti,i.i~.,,;• ~~.A.,#~~.ai~;'.°!~."~~ rr,~~Fi~„,:Y.~i~E.~~R`5 ~8,.~ t~e'd,~~~.zJ~~.{..~~ t x 3 ff '~.~~.,.. r rrd#s, s,; t<' ;§~/'t; i '.'f$f w5+=.. dk 3>s3 ( tt 1 ~a,!P'.=S'( ~~~ # °F`v; t' .~ 9F ~ r~. ~ $ R# bR ~.~5 ~r $ $ '~,}?r~d''!2•~s r i ;£..f.# ~~~;~` r~''"~ ;%Lf!~~ ~,,~$'4 ~.~~~~:'R.~:i~~1~f~"a. ~ ~ `'? ~.tEe.~~'{~A~.~ ~~~'~~.~~.~.~. a,Ls~a~, ,~"f~'~~nia.~,iij£w ~~s~~~. •.. ~ ~ ~ $ ~ .. f. ~ 5 T ~ ) a. ~w ~ L } ~ ~ , ~~ ~ ! t ~, u k # # 4 ~, ~ n ~ ~} h` ~y ~ # G,I ~ I ~1 ~ 1 ~. k L /~ ~ F f C k ~.. Z ~ . ~i ? ~ S ~. ~ ~ ~ ~ F ~ ~. 0..9 ~ j R ~, ~ A 7~. q ~~y 3 @ ~ y ~} y. f e ~S ~ }~ i 4 1~ f `~ R ~ 9 7 # ~ i ~ #. 44 y{ k .£ n ".5i. ~S ~i.£er4.~}i. t ~a.~y ',f.~~ F.. ~',.. '~A,S .; v..~4.iA?.,~~ tFA,s{. l.l~ };9~?~, ~. 'c~%~~~ 6..~~~.1 ~4.k. ~~e.`, ~F~£~F..i56.fs.i~ ~~.~~~RR,.k~.~ ~~.7 F{"" ~.x ~A ya'k',. Bills on Calendar; SB 1950 (Richter}, HB 1G1 (Aubuchon}, HB 27 (Ambler}, HB 825 ~Robaina}, f-1B 283 (Lopez-Cantera} Bills up In C~r~mmittee's Today: SB 1G4G (Constantine), SB 1042 (Bennett), SB 1944 (Fasano}, SB 14G8 (Dean}, Bills up Committee Tc~mc~rrow: SI3 222G (Banking & Ins}, SB 880 (Fasano}, Bills That Are Moving: HB G95 (Schultz}, 5B 195Q (Richter}, SB 998 (Ring}, SB 444 (Bennett} This is the actual amendment language ~ ~'.#~, ~''' '''l,''~~.~~ `~ {~s~~..'i1 ~h,~k~ ~~;,;~~~.~~°~;,~,~~,.,~~~,;,~,",~s~?q~.~.~,~!~~~,'.~,~}.~,~,k~,~~~~~;~'~.~ ..:... '~ ~ ' s 3 < y`tr s `"~ ~.,. § ?f b faS < ~ r•'~SSa .'. ° .... 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PLEASE NOTIFY LEAGUE OF CITIES LOBBYISTS SHOULD YOU HEAR ANY INFORMATION ABOUT THIS ISSUE. Thanks For your help, DEE CARPER FL League of Cities (S50} 570-7236 X850) 570-'1236 CELLULAR 31 C;~)UNCII~Mf~i~~tBER'rA'I"~Ef C)RDINANCE 7 - (}9 o2/os/o~~ AN [:)RDINANC;I~ 1'~'~iENDING TI-IE CITY DF CAPE CORAL CODE OF C)RDINANCFjS C:HAP'1"ER 12, C)FFENSES AND MISCELLANEVUS PRC)VISIUNS, AR'I"ICLE IX, ABANDC)NED REAL PROPERTY; BY AMENDING SECTION 12-92, DEFINITIONS, TO ADD A DEFIN~ITIC)N FOR THE TERM "INSPECTIC)N"; BY .AMENDING SECTION 12-94, I'ENAI,TIES, TC) I'RC)VIDE FUR AN .AFFIRMATIVE DEFEN5E; BY AMENDING S[~C~TI[)N 12-97~A} AND ~B}, MAIN'I"ENANCE REQUIREMENTS; TC) MAKE CLEAR 'rI-~IAT `I"I-lAT ~iAINri"FNANCE REQUIREMENTS SET FC)RTH THEREIN APPLY ONLY TC) TIIE EXTF,RIC)R (.)F 5'1"RUC:TURES; BY AMF~NDINCi SECTIC)N 12-~S~C} AND ~D}, 5I~(:URITY REQUIR}aMFaN'r5, T~) REDUCE TI-1E FREQUENCY C)F INSPECTIONS FROM BI WEEKLY INSPECTIONS TO 1~~IC)NTHIIY INSPECTIONS; PROVIDING FOR SEV~:RABILI'I'Y; AND PROVIDING FC)R AN EFFEC:I"TVE DATE. NOW, TI-IEREFC)RE, THE CITY C)F GAPE CORAL, FLORIDA, .HEREBY ORDAINS THIS C)RDINANCE AS FC)I~I,C)WS: SEC'I"ION 1. The City of Crape Coral Code of Ordinances, Chapter 12, Offenses and Miscellaneous Provisions, Article X, .Abandoned Property is hereby amended as follows: ARTICLE I~. ABANDaNED PRCIPERTY Sec.12~91. Purpose and intent. It is the purpose and intent of the City to establish a process to address the amount of abandoned real property located within the City. It is the City's further intent to specif tally establish an abandoned real property program as a mechanism to protect neighborhoods from becoming blighted through the lack of adequate maintenance and security of abandoned properties. Sec.1Z-92. Definitions. The folltawing words, terms and phrases, when used in this article, shall have the meanings ascribed to them in this section, except where the context clearly indicates a different meaning; ~1t~anc~oned real proper y means any property that is vacant and is under a current notice of default and/or notice of mortgagee's sale by the lender or the subject of a tax lien certif care sale and/or properties that have been the subject of a foreclosure sale where the title was retained by the benef ciary of a mortgage involved in the foreclosure and any properties transferred under a deed in lieu of foreclosure or sale. ~ccessit~le property means a property that is accessible through a compromised/breached gate, fence, wall, etc. Accessible st~sctasre means a .structure/building that is unsecured and/or breached in such a way as to allow access to the interior space by unauthorized persons. 32 Fz~clence r~ f 'vacancy means any condition that on its own, or combined with ether conditions present, would lead a reasonable person to believe that the property is vacant. Such conditions may include, but not he limited t{~, over~,~rown and/car dead vegetation, accumulation of abandoned personal property, statements vy neighbors, passers-hy, delivery agents ar government agents, among other evidence that the property is vacant. ~ ~~reclosarre means the process by which a property, placed as security for a real estate loan, is sold at public sale to satisfy the debt if the borrower defaults. Prr~perty ~'~1ana~er~ent Company means a property manager, property maintenance company or similar entity responsible for. the maintenance of abandoned real property. fn ~ctian means a close viewin of the ro ert and the exterior of an structures located thereon laced as securit for a real estate loan and includes a viewin of an interior ortions of the structure which are visible from the out ide of the structure, However an ins ection does not re uire an ent into an structure for u ase of viewin the interior. Vacant means any building or structure that is not legally occupied. Sec.1Z-93. Applicability. This chapter shall be considered cumulative and not superseding or sub}ect to any other law or provision for same, but shall rather be an additional remedy available to the City above and beyond any other state, county and/or local provisions for same. Sec.12-94. Penalties. Any person who shall violate the provisions of this chapter shall, upon conviction, be punished as provided in the (ode of C)rdinances and the Land Development ~e Re ations, including section 2-85 of the Code of C)rdinances and section 10.2 of the Iaand Development ~e~e Regulations, as applicable. It shall be an affirmative defense to an alle ed violation that the mort a e documents do not 've the lender a ri ht to enter u on and maintain the ro er which is the subject of the_mart~a~e. Sec.1~-95. Public nuisance. ~~ll abandoned real property is hereby declared to be a public nuisance, the abatement of which pursuant to the police power is hereby declared to be necessary for the health, welfare and safety of the residents of the City. Sec, ~2-96. Registration of abandoned real property. ~a} r~ny mortgagee who holds a mortgage on real property located within the City shall perform an inspection of the property that is the security for the mortgage, upon default by the mortgagor, prior to the issuance of a notice of default. If the property is found to be vacant or shows evidence of vacancy, it shall he deemed abandoned and the mortgagee shall, within ten X10} days of the inspection, register the property with the Director of Community Development, or the Director's designee, can forms provided by the Cityl. ~ separate registration is required for each vacant property, 33 fib} if the property is occupied but remains in default, it shall be inspected by the mortgagee or the mortgagee's designee monthly until ~~~ the mortgagor or other party remedies the default, or ~2} it is found to he ~Tacant car shows evidence c.~f vacancy at which time it is deemed abandoned, and the mortgagee shall, within ten ~1t~} days cif that inspection, register the property with the Director of community Development, or the Director's designee, on forms provided by the City. ~c} Registration pursuant to this section shall contain the name of the mortgagee, the direct mailing address of the mortgagee, a direct contact name and telephone number of mortgagee's contact, a facsimile number and e-mail address and, in the case of a corporation or out-of~area mortgagee, the prc~perry management company responsible for the security and maintenance of the property. ~d} An annual re~~stration fee in the amount of one hundred fifty dollars ~$15~.~0}, per property, shall accompany the registration forms}. ~e} 'T'his section shall also apply to properties that have been the subject of a foreclosure sale where the title was transferred to the mortgagee/beneficiary of a mortgage involved in the foreclosure and any properties transferred under a deed in lieu of foreclosure/sale. ~f} Properties subject to this section shall remain under the annual registration requirement, security and maintenance standards of this section as long as they remain vacant. ~g} Any person or corporation that has registered a property under this section must report any change cif information contained in the registration within ten X10} days of the change. ~h} 1'~ny mortgagee who holds a mortgage nn real propert~r located within the City ~vhich is in default and the subject of an outstanding notice of default as of March 1, 2009 shall perform an inspection of the property by ~~ay 1, 2009. If the property is found to be vacant or sho~vs evidence of vacancy, it shall be deemed abandoned and the mortgagee shall, within ten X10} days of the inspection, register the property with the Director of Community Development, or the Director's designee, on forms provided by the City, A separate registration is required for each vacant property. if the property is occupied but remains in default, it shall thereafter be subject to the re-inspection requirements as set forth in Paragraph b above. Sec. 12-9'l. Maintenance requirements. ~a} The exteriors of the ~~roperties subject to this chapter shall be kept free of weeds, overgrown brush, dead vegetation, trash, junk, debris, building materials, any accumulation of newspapers, circulars, flyers, notices, except those required by federal, state, or local law, discarded personal items included, but not limited to, furniture, clothing, large and small appliances, printed material or any ether items that give the appearance that the property is abandoned. fib} 7~e exteriors of the property shall be maintained free of graffiti or similar markings by removal car painting over unth an exterior grade paint that matches the color of the exterior structure. ~c} Front, side, and rear yard landscaping shall be maintained in accordance with the City's standard at the time registration was required. ~d} Landscape shall include, but not be limited to, grass, ground covers, bushes, shrubs, hedges or similar plantings, decorative .rock or bark or artificial turf/sod. fie} Maintenance shall include, but not be limited to, watering, cutting, and mowing of required landscape and removal of yard waste. ~f} Pools and spas shall be maintained so the water remains free and clear of pollutants and debris, Pools and spas shall ccamply ~vith the enclosure requirements of the City Code of Ordinances and Florida Building Code, as amended from time to time. . fig} Failure of the mortgagee or property owner of record to pxoperly maintain the property may result in a violation of the City Code and issuance of a citation or notice of violation/notice of hearing by a (city's code enforcement officer. Pursuant to a finding and determination by the City's special magistrate, the City may take the necessary action to ensure compliance with this section. 34 Sec.12-9$. Security requirements. ~a} 1'rc~perties subject to this section shall he maintained in a secure manner so as not tc~ be accessible to unauthorized persons. ~h} ~'1 "secure manner" shall include, but not be limited to, the closure and locking of windows, doors, gates and other openings of such size that may allow a child to access the interior of the property or structure. Broken windows shall be secured by reglazing or boarding of the window. ~c} If the property is owned by a corporation or out of area mortgagee, a property management company shall be contracted to perform monthly ~dy inspections to verify compliance with the requirements cif this section, and any ether applicable laws. ~d} rl~he property management company shall inspect the property on a monthly basis to ensure that the property is in compliance with this chapter. Upon the request of City, the property management company shall provide a copy of the inspection reports to the code enforcement division. ~e} Failure of the mortgagee or property owner of record to properly maintain the property may result in a violation of the City Code and issuance of a citation or notice of violation/notice of hearing by a City's code enforcement officer or adjudication of such violation by county court. Pursuant to a f nding and determination by the City's special magistrate or adjudication by county court, the City may take the necessary action tc} ensure compliance with this section. Sec.12-99. Additional authority. 'I"he Director of Community Development, or the Director's designee, shall have authority to require the mortgagee and/or owner of record of any property affected by this section, to implement additional maintenance and/or security measures including, but not limited to, securing any and all door, window car other openings, employment of an on-site security guard, or other measures as maybe reasonably required to help prevent further decline of the property. Sec. 12-104. Adoption of rules; expenditure of funds; declaration of City purpose. The City I~Ianager, consistent with City Manager's duties and authorities under the City Charter and Code of (ordinances, including those duties and authorities relating to emergency situations, is authorized and empowered to adopt rules and regulations and expend City funds as may be reasonabl~r necessary and available to carry out the terms of this chapter, the expenditure of such funds being declared a proper municipal purpose. SECTION 2. Severability. In the event that any portion or section of this Ordinance is determined to be invalid, illegal or unconstitutional by a court of competent jurisdiction, such decision shall in no manner affect the remaining portions or sections of this Ordinance which shall remain in full force and effect. SECTION 3. EFFECTNE DATE. This Ordinance shall take effect immediately upon its adoption by the Cape Coral City Council. ~5 AD~)I'TI,D C1T ~~ RI~;GUI~AR (;(~UNCIL MEETING THIS DAY CAF Z(1(~9, JAMES D. BURCH, MAYOR Vt)TE t)F I~iAYt)R r.~ND t~t.)UNCILI~~IFIMBERS: BURCH T ArI~~ BRANDY DEII~E BERTULINI CJRILI~ DAY Dt.)NNFII..L ATTESTED TU AND FILED IN MY t)FFICE THIS DAY OF , 2009. BONNIE J. PUTTER, CITY CLERK APPRt)VED AS Tt) Ft)RM: D()L(.)RES D. MF,NENDEL CITY ATTORNEY r.upe rlbat~c~oned Property (lrc~ (~5 (1(~ {~92,~1,c~oc 36 (:t)UNCIIa1'~iEMB EAR 'lyA"rI t)RDINAN(~ , 32 _ ~~ 05/06/09 1~N [)RDINAN(;E AMENDING '1"HE CITY t)F ~~APE CC.)RAL CODE ()F t)RDINANCES C~~IAPTF~R 12, C)I~FENSI~S AND ~'~IISCEI.I,ANEt_)US PRC)VISIC)NS, ARTICLE IX, ABANDt)N ED READ PR[)PERTY; BY AMENDlNC7 SECTIC)N 12-94, PENALTIES, TO LIMIT TI-IE t)PERA'rI()N C)F AN AFFIRMA'~YIV~J DF.~'ENSE; BY AMENDING SECTIUN 12-9G~D}, REGIS'rRA'ITON ()F ABANDt)NED REAL PROPERTY; TC) PROVIDE FUR A REDUCED REGISTRATIC.)N FEE STRUCTURE WHF,N PROPERTY WHICH IS SUBJECT TC) THE REGISTRATIC)N REC~UIREMENT OF SECTION l2-~G IS NU LONC~ER TITLED 1N THE NAME OF THE DEFAULTING MORTGAGOR; PROVIDING FUR SF.VERABII..ITY; .AND PROVIDING FUR AN EFFECTIVE DATE. NOW, THF,REFC)RE, THE CITY OF CAPE CORAL, FLORIDA, I-IEREBY ORDAINS THIS ORDINANCE AS FC)LLC)WS: SECTIUN 1. The City of Cape Coral Code of Ordinances, Chapter 12, Offenses and Miscellaneous Provisions, Article X, Abandoned Property is hereby amended as follows: ARTICLE IX. ABANDQNED PRaPERTY ~~*~ Sec.I2-94. Penalties. Any person who shall violate the provisions of this chapter shall, upon conviction, be punished as provided in the Code of Ordinances and the Land Development Regulations, including section 2-85 of the Code of trdinances and section 1D.2 of the Land Development Regulations, as applicable. It shall be an off rmative defense to an alleged violation of Section 12-97 that the mortgage documents do not give the lender a right to enter upon and maintain the property which is the subject of the mortgage. ~*** Sec.12~96. Registration of abandoned real property. ~a} Any mortgagee who holds a mortgage on real property located within the City shall perform an inspection of the property that is the security for the mortgage, upon default by the mortgagor, prior to the issuance of a notice of default. If the property is found to be vacant or shows evidence of vacancy, it shall be deemed abandoned and the mortgagee shall, within ten ~1~~ days of the inspection, register the property with the Director of Community Development, or the Director's designee, on forms provided by the City. A separate registration is required for each vacant property. (b} If the property is occupied but remains in default, it shall be inspected by the mortgagee or the mortgagee's designee monthly until ~ 1} the mortgagor or other party remedies the default, or ~2} it is found to be vacant or shows evidence of vacancy at which time it is deemed abandoned, and the 37 mortgagee shall, within ten ~lll} days of that inspection, register the property with the Director of Community I]evelopment, or the 1irector's designee, on forms provided by the City. ~c} Registration pursuant to this section shall contain the name of the mortgagee, the direct mailing address cif the mortgagee, a direct contact name and telephone number of mortgagee's contact, a facsimile number and e-mail address and, in the case of a corporation or out-of area mortgagee, the property management company responsible for the security and maintenance of the property. ~d} An annual registration fee ' , , shall accompany the registration forms} in the followin amounts; 1 if title to the ro ert is in the name of the defaultin mart rat the time re •stration is re aired then the fee shall be in the amount of one hundre fif dollars 150.x0 er . ra ert 2 If title to the ro er is in the name of a erson or enti other than the defaultin mart a or at the time re •stration is re aired and the ro er is then currentl listed for sale with a Florida re •stered real estate broken e f rm or Florida licensed real estate a ent then the fee shall be waived althou h re nstration shall still be re uired• 3 In all other cases the fee shall be in the amount of fif dollars 50.00 er ro er . ~e} 'i"his section shall also apply to properties that have been the subject of a foreclosure sale where the title tivas transferred to the mortgagee/beneficiary cif a mcartgage involved in the foreclosure and any properties transferred under a deed in lieu of foreclosure/sale. fif} Properties subject to this section shall remain under the annual registration requirement, security and maintenance standards of this section as long as they remain vacant. fig} Any person or corporation that has registered a property under this section must report any change of information contained in the registration within ten X10} days of the change. ~h} Any mortgagee who holds a mortgage on real property located within the City which is in default and the subject of an outstanding notice of default as of March 1, 2009 shall perform an inspection of the property by May 1, 2009. If the property is found to be vacant or shows evidence c_~f vacancy, it shall be deemed abandoned and the mortgagee shall, within ten X10} days of the inspection, register the property with the Director of Community Development, or the Director's designee, on forms provided by the City. A separate registration is required for each vacant property. if the property is occupied but remains in default, it shall thereafter be subject to the re-inspection requirements as set forth in Paragraph b above. Sec.12-97. Maintenance requirements. ~a} The exteriors of the properties subject to this chapter shall be kept free of weeds, overgrown brush, dead vegetation, trash, junk, debris, building materials, any accumulation of newspapers, circulars, flyrers, notices, except those required by federal, state, or local law, discarded personal items included, but not limited to, furniture, clothing, large and small appliances, printed material or any other items that give the appearance that the property is abandoned. fib} The exteriors of the property shall be maintained free of graffiti or similar markings by removal or painting over with an exterior grade paint that matches the color of the exterior structure. ~c} Front, side, and rear yard landscaping shall be maintained in accordance with the City's standard at the time registration was required. ~. ~d} Landscape shall include, but not be limited to, grass, ground covers, bushes, shrubs, hedges or similar plantings, decorative rock or bark or artificial turf/sod, ~e} l~iaintenance shall include, but not be limited to, watering, cutting, and mowing of .required landscape and removal of yard waste. fif} Pools and spas shall be maintained so the water remains free and clear of pollutants and debris. Pools and spas shall comply urith the enclosure requirements of the City Code of Urdinances and Florida Building Code, as amended from time to time, 38 ~~} Failure of the mc~rt~~agee or property owner of record to propexly maintain the property may result in a violation of the (lity Code and issuance of a citation or notice of violation/notice of hearing by a c;ity's code enforcement officer. Pursuant to a finding and determination by the City's special ma~~istrate, the (:ity may take the necessary action to ensure compliance with this section. ~~~~ SECTICIN 2. Severability. In the event that any portion or section of this Ordinance is determined to be invalid, illegal or unconstitutional by a court of competent jurisdiction, such decision shall in no manner affect the remaining portions or sections of this Ordinance which shall remain in full force and effect. SECTION 3. EFFECTIVE DATE. This Ordinance shall take effect immediately upon its adoption by the gape (;oral City Council. ADUPTF~D AT A REGULAR COUNCIL MEETING THIS DAY C)F X009. JAMES D. BURCH, MAYOR 39 ~'~~TF~ ()~' 1~~IAY()R AND CC)UN(~~IIJMEMBERS: B L~ RC: I-~ 'rAT~J B RAN DT DIIILLJ BERT{)IJINI ~~RILL DAY Dl.)NN~IIJ~J ATTI=~:STf-:D T() AND FILED IN MY C)~,FICE T~IIS DAY OF , 7~~t~~a. BONNIE J, PC~'I"TER, CITY CLERK r~ APPRC)VI~D AS TC~ FORM: MARK Ia. IJUPE ASSIS"I"AN'I" CITY A`~I"URNEY rll~anc~c~n~d Pr~~pert~- ()rd ()5 ()G (l9[2] 40