Rebuilding Kalamazoo with Strong Partnerships

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Mary Balkema is the Kalamazoo County Treasurer and has been for six years. When I meet her one bright afternoon, she is wearing shorts and a T-shirt that reads, “inspector.” She’s not dressed up for work today because we’re going for a drive. This tour will showcase what she and partners like the Kalamazoo County Land Bank Authority (KCLBA) have been able to achieve thanks to the State’s package of thoughtfully-developed laws governing land banks and tax foreclosure.

Kalamazoo, the largest city in southwest Michigan, has not suffered nearly the population loss Detroit has, but has still experienced a declining population and its share of blight. An efficient tax foreclosure process is Balkema’s priority, and she’s paid special attention to helping keep homeowners in their homes. Thanks to reform of the Michigan tax foreclosure process in 1999, county treasurers like Balkema have the power to postpone tax foreclosure in the case of financial hardship. This year, Balkema was able to access a $100,000 grant put together by the Kalamazoo Community Foundation and the Greater Kalamazoo United Way, which served as something of a buffer for homeowners faced with tax foreclosure. Part of a larger $4 million fund called the Lifeline Initiative, residents on the brink of foreclosure were given up to $2,000 and placed on payment plans.

The properties that remain are foreclosed on by Balkema’s office. To make sure these properties not sold in auctions are being used in ways that increase neighborhood stability, Balkema works closely with the KCLBA. According to Kelly Clarke, executive director of the KCLBA, the Michigan State Housing Development Authority (MSHDA) received a $223 million award from HUD’s Neighborhood Stabilization Program 2, the largest single NSP2 grant in the country. The grant money was allocated in a competitive process structured to encourage land banks to use the tools available to them in their communities and develop relationships with their cities.

The City of Kalamazoo received $9 million while the KCLBA received $6 million. For the KCLBA, which had only been active since 2010, this was huge.

Together, the two entities use the money they raise and receive to revitalize the city, reclaim vacant properties and bolster the community. “Working hand in hand with the City of Kalamazoo has been a great partnership,” Clarke says. “It has been very effective to bring together the City’s planning and community knowledge and expertise with the Land Bank tools for property acquisition, holding and redevelopment.”

Balkema talks about their strategies while showing me some of the results of these partnerships.

Rose St., located north of downtown, is the first street we visit. Balkema points out a church. “First, you pick a strong anchor,” she says. “A school, a church — any place where people would congregate.”

A prime example of such an anchor would be Bronson Hospital, a major employer servicing 10,000 people each year. The hospital and adjacent famers market were attractive to the KCLBA when formulating a strategy for the encompassing area. Another anchor is the Family Health Center, a recent $9 million anchor.

Surrounding the anchors, the housing stock must be assessed individually. According to the KCLBA’s Clarke, each property is evaluated “based on its condition with respect to rehabilitation vs. demolition.”

“We accept property transfers for rehabilitation when we believe there will be a market for the homes once rehabilitated,” Clarke says. “In many cases, unfortunately, tax foreclosures are older properties, have suffered many years of neglect, and are in a state of disrepair that makes them financially infeasible to rehabilitate. In these cases, and if funds are available, we demolish the structure to eliminate blight and the issues that blighted and abandoned properties can present.”

These issues include health hazards, as well as possible criminal activity. Balkema recalls one home that was so full of bed bugs that the workers had to move everything found inside the house immediately to the landfill. Balkema places “No Trespassing” signs on homes awaiting demolition or rehabilitation and works with local law enforcement to make sure those signs are enforced.

On the lots where a blighted property once stood, the Kalamazoo Home Ownership Program(KHOP) can build new, energy-efficient homes. KHOP is a partnership between the City and the KCLBA using funds provided by the American Recovery and Reinvestment Act. These homes compete well against new, market-rate housing, but are sold to residents on a first-come, first-serve basis abiding entirely by the Fair Housing Act. Interested buyers who make under the 50 percent median could get a $100,000 home for as low as $35,000. This either keeps neighbors in their own community, or draws new residents, such as school teachers or hospital workers, looking to live closer to work.

Alternatively, the lot may be gifted to the owners of the adjacent home. The new owners may receive help with landscaping or build a garage. Adopt-a-Lot, a program offered by the KCLBA, conveys lots at no cost to neighborhood associations, churches, resident groups, schools, businesses, block clubs and service organizations for pocket parks, play areas, neighborhood gardens or other community building endeavors.

Balkema stops her van in front of a KHOP home being built across from Mt. Zion Church. Balkema says one of the construction workers here is in a job-training program. He has two felonies on his record, but shows up to work every day and will become a committed neighborhood resident once he has established credit.

We then head over to Blakeslee St., where a long vacant tuberculosis sanitarium used to reside until its demolition earlier this year. Balkema now reveals a new senior housing development that, when complete, will feature eight, 900-square-foot duplexes and a community center. The developers completely cleared the area of any possible contaminants before construction began, and another $70,000 in landscaping will beautify the area.

Clarke will be providing a similar tour of Kalamazoo during the Center for Community Progress’ 7th Annual Land Bank Conference October 14-16, along with Balkema and other community leaders instrumental in making these projects work. Like most land banks, Clarke and her team work to “reposition vacant, abandoned, tax foreclosed or otherwise underutilized property” as assets to the community. Rehabbing and demolishing blighted properties, working with nonprofit and for-profit developers to create housing and other opportunities, turning vacant parcels into side lots or gardens and tracking the foreclosure inventory is all part of the job. And it all supports what others are already doing to make the city an exciting place to be.

“A lot of community leaders and officials have done a really good job creating a pretty vibrant downtown over the last two decades,” she says. “We’ve certainly seen a renewed interest in the downtown area. We see the role we play as working to invest in the neighborhoods that support the immediate downtown, and working to support the residents who are already living and working here. We’re hopeful that these two investments can play off one another and continue to strengthen the city.”

KCLBA’s strong partnership with local municipalities is also mirrored in their relationships with neighborhood associations, as well as the residents who agree to care for the side lots, move into the new homes and participate in community programs. And the land banking conference isn’t just for government officials, Clarke says, but for anyone who wants to get involved in supporting the growth and vitality of their city. “It’s a great way to get exposure to rethinking our cities and using property in creative ways,” Clarke says.

J. Bennett Rylah is the Managing Editor of Rapid Growth Media in Grand Rapids, Mich.