‘THE SYSTEM IS BROKEN’
Mayor looks to slash ‘Gordian knot’ of city property sales
Saying the city’s system for selling tax-delinquent property “just does not work,” Pittsburgh Mayor Bill Peduto this week predicted “improvement next year” and laid out a vision for simultaneously rehabbing abandoned homes and training new tradespeople.
“My goal is that we get to the point where several hundred properties a year are being developed by nonprofits, land trusts, and faith-based institutions,” the mayor said in an interview with the Pittsburgh Post-Gazette. Rather than tweak a system that often takes years to sell properties to eager buyers, he’ll work on developing alternatives, he said.
Mr. Peduto’s administration is also finalizing a new policy that would prevent the repeat of an ethics lapse that brought scrutiny to the city’s Real Estate Division last year, after a manager sold himself a house the city had taken for back taxes.
“We’ll never be in the situation again where the person signing the paper for the sale is also the person receiving the property,” he said.
The sale of a Beechview house by Real Estate Division manager Aaron Pickett, to himself for $2,500, drew a rebuke from the state Ethics Commission. He agreed to pay the state $5,000 and to forfeit any profit he makes if he sells the house within five years.
A new policy on sales of city property to employees “is nearly complete and is under review by the mayor’s office,” according to mayoral spokesman Timothy McNulty.
Mr. Pickett’s 15-month purchase process contrasted with the system’s typical performance. An audit by city Controller Michael Lamb found five times as many applications as successful sales. A Post-Gazette probe found that even when the system works, the city typically takes about 28 months to sell long-vacant property to private individuals.
Ethel Johnson, a retired county treasurer’s office employee from the Hill District, said she applied in 2014 to buy a city-owned house on Webster Terrace. On Jan. 22, she got a judge’s order confirming her as the successful bidder. She then waited another 10 months, during which she frequently called city offices for updates, before finally closing the purchase Wednesday.
“I think the system is broken,”
Ms. Johnson said, minutes after signing the deed. “They’ve got too many properties. All of these properties, and nobody is letting them go.” (The city owns about 14,000 parcels, though some of them are government buildings and park land.)
Ms. Johnson said that she and her husband, William, would change the locks on the property after Thanksgiving, and would eventually give the keys to their granddaughter.
Mr. Peduto said the city’s property sale system is a “Gordian knot” governed largely by state laws that jealously guard the rights of property owners, even if they abandon their holdings and fail to pay their taxes. The city has to go through notification processes and leap through legal hoops before taking property and selling it to a new owner.
He said the five-year-old Pittsburgh Land Bank is meant to take ownership of abandoned property, reduce the red tape and put more land up for sale. So far, though, it owns only one property. Its board is looking for an executive director, who will be charged with bringing it up to the levels of other land banks.
The land bank “has been a disaster from day one,” said Councilwoman Theresa Kail-Smith, who sits on the bank’s board. “We’ve not accomplished much of anything.” She’s leaning toward improving the staffing at the Real Estate Division in hopes that it can then move more property.
Mr. Peduto said the Urban Redevelopment Authority is being restructured to be more effective at getting abandoned property into productive use. Details on that agency’s plans are due out early next year.
He added that emerging neighborhood land trusts will also help to take more properties out of the city’s hands. Several community groups have started to set up land trusts, which can buy property and ensure that it remains affordable in perpetuity.
The mayor said he sees a future in which nonprofit entities receive abandoned properties, training programs rehab those properties using trades apprentices, and “long-term, rent-to-buy or first-time home-buyer programs ... allow people to move into these properties and own them.
“I would like to see a program where every church in the city has the opportunity to redevelop the block that they’re on, and the block around them, in an adopt-a-block program, where they can then hire people from the neighborhood to work on these properties, fix them, and then make them home ownership opportunities,” he said.
A blighted property, he said, can be “a classroom, a workforce development project, training people from the neighborhood in electrical work, plumbing, roofing, painting, all the different trades that are needed. And take that property that is an anchor to a community right now, and dragging it down, and turn it into an anchor where other development will happen around it.”
Brandi Cox, a Spring Garden veterinarian, and her husband would like to buy, and perhaps to develop, four lots that are a block and a half from their home. The couple applied two years ago to buy the vacant Spring Garden Avenue lots, which the city has owned for 21 years.
They went through most of the city’s purchase process, and in July, the proposed property sales went before Pittsburgh City Council for approval. Councilwoman Darlene Harris, whose district includes Spring Garden, deleted them from the agenda, saying she hadn’t heard from the area community group. She relies on such groups to tell her whether a given sale is good for the neighborhood.
The proposed sales returned to council’s agenda in November. Ms. Harris deleted them again on Nov. 13, saying it was “at the request of the community” — though she later clarified that she had not yet heard back from the Community Association of Spring Garden and East Deutschtown.
An officer of that group said it wants to make sure that the neighboring property owners get a chance to make offers on the properties before anyone else purchases them.
“And this is all news to me,” said Ms. Cox, informed of Ms. Harris’ comments. She called the city’s property sale system “a mess. It’s unfair . ... The rumors are that you have to be in with somebody to get it.”
What now? “I’ll keep trying.”