Foreclosure Blight: Government Efforts to Address Neighborhood Decay
A year ago the Neighborhood Stabilization Program was passed by Congress that gave states and localities just under $4 billion buy and rehabilitate abandoned homes in the hardest hit neighborhoods across the United States. The ten states and localities allocated the most funds are California $145.1 million, Ohio $116.9 million, Texas $102.0 million, Michigan $98.7 million, Florida $91.1 million, Indiana $83.8 million, Georgia $77.1 million, Miami-Dade County $62.2 million, Pennsylvania $59.6 million, and Chicago $5.2 million. The funds have to be allocated by the fall of 2010 which is coming to fast for some. The goal is to stop home values from plunging in neighborhoods with high numbers of vacant and abandoned properties that have been foreclosed but are not being kept up. State and city housing and community development departments have been surprised to find that banks are not as willing to let go of these run down foreclosed properties as they expected. Implementing the program has proven difficult for all but the larger cities because they have never participated in such a program. Chicago and New York have had the best success because they have the experience needed to effectively put the program into action. They have already turned several vacant properties into livable homes. Rhode Island officials have spent $3 million on down payment assistance for over 75 families and $4 million to on extremely rundown foreclosed properties to be renovated at a later date.
Business Bankruptcy
Circuit City Stores and their official committee of unsecured creditors have filed a Joint Plan of Liquidation ending 60 years of business in appliance and electronics retail sector. Circuit City originally filed for bankruptcy in November 2008 and has struggled to find a way to continue in some fashion. This weeks filing is a liquidation filing which will terminate all interests in the debtors and be a dissolution and wind-up of a business affairs of Circuit City Stores by the transfer of any remaining assets to the liquidating trust. The closing of the over 750 stores earlier this year added to the vacancy woes of commercial property landlords which are struggling to fill the square footage given up with the closings of other large retailers like Mervyn’s LLC, Linens ‘N Things, Bombay Co., Sharper Image Corp. and Steve & Barry’s LLC.
Financial Services Preparing for the Red Flags Rule
Scheduled to be enacted on Nov. 1, 2009 the Red Flags Rule mandates financial institution and creditors to have and deploy a written Identity Theft Prevention Program (ITPP) that monitors, detects telltale signs of identity theft activities and addresses possible violations of ID theft. The determining factor for having to comply to the new regulation rests with the definition of “covered accounts”. Covered accounts are defined in this instance as “…accounts that an institution maintains for personal, family, or household purposes that are designed to allow multiple payments or transactions, or any accounts that a creditor or institution offers or maintains for which a reasonable risk o ID theft to the customer exists.” This deion would include most banks, credit card companies, and other financial service providers that allow for movement of funds. Written ITPP’s documenting who is responsible for updating and administration of the plan will be the beginning of accountability trail in future data breach incidents investigated by the Federal Trade Commission.
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