Do you support plans to stem foreclosures by seizing and modifying mortgages through reverse eminent domain?
- No. (74%, 37 Votes)
- Yes! (26%, 13 Votes)
Total Voters: 50
Q: A lot of Op-Ed stories out there think they have the right handle on how Richmond is going to help homeowners. What is the current status of the reverse eminent domain action? What are Richmond’s next steps?
A: We are continuing to call on the servicers and trustees of the loan to sell us the loans voluntarily. Thus far they have refused to do so, so we are once again asking them what their solution is to this monumental problem of our people continuing to lose their homes to foreclosures due to severely underwater mortgages. So far, no fix has been provided by them and our homeowners, our neighborhoods and our city continue to suffer as a result of bad loans sold to our community members. We continue to assert our right to acquire mortgages by eminent domain if necessary. We are currently working to bring others cities on board so they can join us in this effort. In fact, cities throughout the nation have supported resolutions in support of Richmond’s effort and are having their city councils explore this program for their communities.
Q: Has the litigation between Richmond and Wall Street strained the city’s resolve to move forward with the eminent domain plan?
A: No, not at all.
Q: When does the city expect to hear about the court action?
A: The judge dismissed the case (actually he dismissed both case/lawsuits that the banks waged against the city). He was clear that the case was “not ripe” and it was premature to even be discussing this. We, the City, haven’t done anything yet, except offer to purchase these loans at fair market value. The banks were trying to stop the program even before it began!
Q: How does Richmond respond to the claim that its use of eminent domain will discourage lenders from lending in Richmond?
A: If lenders would even try to restrict credit to homebuyers or homeowners in Richmond, we know they will be attempting to redline our community (which is illegal).
Q: Will Richmond residents still have unhindered access to financing if this plan were to go into effect?
A: Absolutely. There are many fair housing organizations and civil rights lawyers who have teamed up and put out letters and other documents to Congress and through our judicial system saying that such action by lending institutions would be met with legal action.
Q: When does the city anticipate this plan going into effect?
A: Over the next several months, we are meeting with many other California city officials. We are hoping to form partnerships with these cities. Together with our partners, we will take the next step and form a Joint Powers Authority (JPA). The JPA will then become the body that acquires (through voluntary sale from the banks or through eminent domain, if necessary) the underwater mortgages at fair market value.
Q: As of now, have any cities agreed to participate in the JPA?
A: Currently San Francisco, San Pablo, Vallejo, and Antioch are all in the process of examining this.
Q: Many opponents point to the fact reverse eminent domain does not address other aspects of what’s wrong with Richmond, such as lack of jobs. How do you see these other economic factors impacting Richmond?
A: We have a world-renowned job training program. We are a leader in the Bay Area for our training programs, especially green job training. Our unemployment rate is at its lowest rate since June 2008. What steps is the city taking to make sure if reverse eminent domain gets the green light, homeowners won’t simply default again? The purpose of acquiring the inflated mortgages (which are bad loans sold to our community by predatory lending practices) is to reduce the principal in line with current home values, thus making mortgage payments affordable and sustainable for the homeowner. This will also allow more money to be kept in the pockets of homeowners to spend on our local businesses so our local economy can recover. With more customers, our businesses will be able to expand and create more jobs.
Q: What makes Richmond different from the other cities proposing this unorthodox use of eminent domain?
A: Richmond was hit hard by the foreclosure crisis. We are a majority people of color city. We are a working families community. Myself and a few others on the city council are clear that it is our job to stand for the people we represent (and not for Wall Street). For me, this is a situation of justice. We also have a major coalition of progressive community groups that include underwater homeowners that are driving this program. We are a progressive city that has been recognized for innovative initiatives on many fronts. I believe it is essential to stand up to those entities that cause harm to our community.
Q: How many people does the city anticipate the reverse eminent domain will help?
A: We sent out 624 letters. We will reevaluate once we get to the point of doing the actual transactions.
We’ll continue to follow this story as it breaks. For information on Richmond’s proposed reverse eminent domain plan, see:
Video: Reverse eminent domain