[StBernard] Officials hope to put sale of Road Home properties on the fast track

[Westley Annis]

This is good news, but what would be better news if the State Legislature
and Governor would pass a law that says anyone who purchases a Road Home lot
can develop it to their desire as long as what they build is in accordance
with state and local code, and local governing authorities (city or parish
governments) are prohibited from passing any kind of ordinance preventing
the new land owner from properly improving the lot.

In fact, I say start asking the Senate and House candidates their position
on this and if they would support such legislation, even if it were a
proposed amendment.


-----Original Message-----
Officials hope to put sale of Road Home properties on the fast track

Published: Thursday, August 04, 2011, 9:05 PM     Updated: Thursday, August
04, 2011, 9:09 PM

 By David Hammer, The Times-Picayune 

When the state formed the Louisiana Land Trust back in 2006, it was designed
to temporarily hold storm-damaged properties purchased through the Road Home
program and quickly pass them on to parishes for redevelopment.

Five years later, Land Trust leaders aren't feeling so temporary, and they
are doing a lot more holding than passing of properties.

All told, the trust has received 10,554 properties that the state purchased
through the Road Home's buyout options, and so far, only a third have been
transferred to new owners through a process run by parish authorities.

The Louisiana Land Trust is still left with about 7,000 lots to maintain and
secure, and it's running out of money. LLT board member Don Vallee said that
at the current costs of property maintenance expenses, the quasi-public
agency will run out of money in less than a year.

And at the laggard pace that St. Bernard and Orleans parishes are
transferring and selling the lots, it would take several more years to get
them all off the trust's books, Vallee said.

The Louisiana Land Trust received state funds when the buyout program first
got under way, but director Mike Taylor said the state's Disaster Recovery
Unit, an office he once ran, has told him he's on his own this time.

As a result, Taylor said, it's time to end the current strategy that makes
the LLT wholly dependent on the efforts of St. Bernard Parish and the New
Orleans Redevelopment Authority to dispose of properties.

The LLT has a plan to clear almost all the properties by next summer.

St. Bernard Parish was slow to start its program for transferring
properties, but it has speeded the process significantly in 2011.

New Orleans has not shown similar improvement.

So, Taylor presented a new plan to the New Orleans officials Thursday.

The LLT board will consider a series of resolutions at a meeting Monday in
Baton Rouge authorizing the agency's own property auctions, without having
to rely on procedures set up by the two parishes.

NORA Director Joyce Wilkerson said the process still needs to be negotiated
between the city and the state, and he declined to comment further.

500 or bust

Orleans and St. Bernard have each promised to sell or take possession of at
least 500 properties per month, Vallee said. St. Bernard has increased its
pace dramatically in the past six months, taking title to or disposing of
about 173 properties per month since the start of 2011, but that's still far
short of 500.

The cash-strapped NORA, which has waited more than a year for a new
financing agreement with City Hall, is plodding along at just 83 lot
transfers a month.

The trust's new plan would give the parishes a new chance each month to meet
the target of 500 transfers a month, but if they fall short, the trust would
be granted the authority to select the number of properties by which they
miss the target of 500 and put them directly on the auction block.

In other words, if NORA sells 100 lots next month, the Land Trust would be
able to choose 400 other properties in Orleans Parish to sell through a
private auction company.

Two City Council members indicated Thursday they support the idea of having
the Land Trust auction properties directly.

Moving target

Despite the 500-transfer goal set out in the LLT resolutions, city of New
Orleans spokesman Ryan Berni said the real target number is still being
negotiated among the city, state and LLT.

Whatever the target number, a move to LLT-controlled sales puts pressure on
the parish agencies, particularly NORA, which has long said it wanted to be
selective about when and where it sells lots to private developers so as not
to flood the market and to make sure the lots don't become blighted again.

Nearly half of NORA's 1,500 sales to date have been through the Lot Next
Door program, which gives adjoining neighbors first dibs on a lot at its
fair market value. The rest of the sales have been to nonprofits, private
developers and other NORA programs.


But the Lot Next Door conduit is starting to run dry, Taylor said, adding
that he thinks the city's Lot Next Door ordinance is too restrictive. Under
the current wording, even if the qualifying neighbors have already chosen
not to purchase a lot through Lot Next Door, NORA can't make a cheaper deal
with large-scale developers without first going back to the neighbors and
giving them another shot.

By contrast, Plaquemines Parish quickly disposed of most of its properties
by putting them all up for auction and giving next-door landowners one
chance to match the highest bid.

Maintaining the lots

At this point, fewer than 300 New Orleans properties are in the queue for
Lot Next Door sales, so Taylor is not optimistic that the program will keep
lots moving off the LLT's rolls.

City Councilwoman Cynthia Hedge-Morrell told Land Trust officials that the
council is ready to "tweak" the Lot Next Door ordinance to speed the
process.

For years, NORA has been fearful of flooding the market with too many empty
properties that could fail to draw buyers or become neglected by new private
owners, creating new tracts of blight in an already blight-riddled city.

But critics of LLT complained that the trust was spending too much on a
property maintenance contract that made its lots look incongruously pristine
amid the expansive neglect of, for example, the Lower 9th Ward. The LLT's
last allocation from the state in 2008 was supposed to last five years, but
it's on pace to be exhausted in less than four.

LLT spokeswoman GeGe Roulaine said the trust is spending about $100 per
property each month to make sure the agency isn't adding to the blight
problem. The trust pays to cut grass, to clean up trash and to provide
security. By the end of the year, the agency expects to have spent $72
million on property upkeep alone.

And it could get worse for the Land Trust if the state starts seriously
enforcing the rules of its Road Home rebuilding program. Studies suggest
that as many as 40,000 homeowners who took federal grants to rebuild their
homes within three years have failed to do so. The state recently began a
grant-recovery process, but some portion of those properties may have to be
converted to buyouts and handed over to the Land Trust.

Taylor said that could be a nightmare, not only because the lots will add to
the maintenance bill and will require more demolitions, but also because
they would not have gone through a rigorous title search before being handed
over to the Land Trust.

Staff writer Bruce Eggler contributed to this report. David Hammer can be
reached at dhammer at timespicayune.com or 504.826.3322.