JN-SPAN Continued: Congressional Hearing on Foreclosures in the Twin Cities

Guest post and videos by the Hawthorne Hawkman.

We continue with footage from the Congressional Field Hearing on the impact of the foreclosure crisis on public and affordable housing in the Twin Cities (the official name of that event). Pictured above is Housing Preservation Project attorney Mark Ireland. Mr. Ireland did a phenomenal job representing Hawthorne in our lawsuit against Citimorgage in the EcoVillage.

I really wish the federal government would come up with a spiffier name for this hearing, or at least a slick acronym, but what can you do?

I applaud Mark Ireland's speech because at about the 3:10 mark he gets very gutsy...

In a very straightforward way, Ireland states that we haven't fully discussed the issue of race in the foreclosure crisis. "In every study that I've seen," he says, "the disproportionate impact of the economic crisis, the foreclosure crisis, on renters, on homeowners, has been on communities of color and people of color." So as we develop solutions to these crises, we must talk about race. Thanks, Mark, for putting that out there.

Easily the most moving panelist of the entire event was Marion Anderson, a north Minneapolis resident whose landlord went through foreclosure. The panelists were all told to keep their remarks to five minutes or less, although many went over by a minute or two before being cut off. Mr. Anderson went on for almost twice that length, but his story was so compelling that Rep. Maxine Waters, the chair, told him to keep on talking until he was finished. My summary below will surely not do Mr. Anderson justice, so I strongly recommend that you take ten minutes to watch the video and listen to what he has experienced.



His landlord went into foreclosure in August of 2008. About two months AFTER the August '08 sheriff sale, Mr. Anderson began to rent the unit. The landlord also declared bankruptcy, which may have lengthened the foreclosure process. He did not find out that anything was amiss until February of 2009. That's when the landlord started taking appliances out of the property, starting with the washers and dryers. Then the utility shut-off notices started to come, even though in the lease the utilities were paid for by the landlord.

OF COURSE the landlord still wanted to collect the rent, but the tenants organized and contacted the utility companies to pay them instead. On April 15, the FIRST legal day to do so, the landlord manually shut off the furnace. Then he tried to evict the tenants for non-payment of rent. The landlord disappeared from the scene entirely, but around October 15, the Minneapolis Fire Department (which oversees mult-unit housing) informed the tenants they had 72 hours to get the heat turned on or the building would be condemned and they'd be forced out. There was also no rental license anymore.

The Fire Department worked with the tenants to contact Center Point and get the furnace turned back on, and Legal Aid of Minneapolis helped out too. But then the vacant units became occupied by squatters. The squatters didn't want to contribute to the utility payments, but they did want to contribute to the condemnation of the building by using meth. There is a new owner, and it looks like things will be resolved in the good tenants' favor.

Mr. Anderson and his neighbors are the lucky ones. Countless others experience similar difficulties and wind up homeless.

In a question and answer session later, Rep. Ellison asked whether Mr. Anderson was ever told directly that the building was in foreclosure.



Of course, the answer was "no." And there's the big problem. There are all sorts of protections out there for renters whose landlord is in foreclosure, but if nobody makes them aware of the situation and the resources, those people will fall through the cracks. Any suggestions about how to deal with this are more than welcome. But enforcing such disclosures from landlords to tenants is almost impossible.

Mark Ireland was also asked about his comments regarding racial justice:



He referenced a structure laid out in Dr. Martin Luther King's last book. That structure involves identifying where we are at right now, asserting vigorously the dignity and worth of all people, then you identify the structural impediments to moving forward, and then you "fight like hell."

JN-SPAN: Congressional Field Hearing on Foreclosures and Affordable Housing

Guest post and videos by the Hawthorne Hawkman.

Falling somewhere in between the venerated C-SPAN network and The Onion's "O-SPAN," Johnny Northside brings you extensive footage of Saturday's Congressional hearing in Minneapolis. We'll call it JN-SPAN.

Let's get the dry stuff out of the way first. This was a Committee on Financial Services meeting, an official hearing of the United States House of Representatives. Its title was "The Impact of the Foreclosure Crisis on Public and Affordable Housing in the Twin Cities," and this was the second time Rep. Keith Ellison has brought such a hearing to Minneapolis.

In the video above, NoMi's state Senator Linda Higgins is speaking about a condemned four-plex near her home...

...that was bought by a consortium of developers from North Dakota (state motto: "Flat but boring"). These developers bought approximately 50 properties in north Minneapolis, and in this property's case, failed the inspection for a certificate of occupancy. The developers lied about being certified asbestos removers, and got caught. But their work on the other houses is reportedly just as shoddy. (Hawkman asks: Can we get a name? Is this a new slumlord or one that we're already aware of?)

Rep. Jim Davnie spoke next.


Davnie has been another leader on predatory lending and foreclosure issues affecting Minneapolis and all of Minnesota. He and Senator Higgins have worked together to create or help pass legislation that curbed predatory lending activities, equity stripping, and abuses by landlords. Both houses of Minnesota's legislature also passed a Subprime Borrowers' Relief Act, which would have provided mediation for borrowers with subprime mortgages - if it hadn't been vetoed by Governor Pawlenty.

Up next was Hennepin County Commissioner Gail Dorfman.


Commissioner Dorfman has done great work around foreclosures and vacancies as well, but she references a "14% decline in home values" for north Minneapolis as a result of foreclosures, and that sounds incredibly low. I'd like to see what that number is once it's broken down by neighborhood, if that data is out there. In Hawthorne, I'd bet it's more like 140%. Continuing with numbers, Dorfman states that 55% of foreclosures in Minneapolis are from landlords, and that 10% of the people in homeless shelters in Minneapolis are from these properties.

ADDENDUM: An anonymous commenter on this blog pointed out that in my rebuttal of the inaccurately low percentage of home value decline at least in my area of NoMi, I let hyperbole get in the way of actual mathematics. A 140% decline would mean that the property has a negative value, which only happens in Detroit. Even in the most extreme cases of a fraudulent $300,000 appraised value of a Dream Home, and then a resale in the $30,000 range, the percentage decline would be 90%.

I didn't get video footage of Mr. Dan Bartholomay of the Minnesota Housing Finance Agency. His content contained very detailed mortgage technicalities, so naturally I was taking notes like a madman. Here's the Reader's Digest version of his speech: The Housing Finance Agency does loans geared towards low- and moderate-income households, and their loan portfolio performed significantly better than the market. However, funding has been difficult because subprime mortgages have given the whole secondary market a bad name. Either nobody trusted these mortgage bonds in general, or they didn't trust the information claiming the stability of such an investment. So now thanks to the subprime meltdown, finding access to funds that actually help poor people AND make money on their own is increasingly difficult.

The highlight of the first panel was CPED Director of Housing Policy and Develpment, Tom Streitz. If you watch no other clip from these videos, at the very least jump to the 1:40 mark of this one.


That's when Tom Streitz discusses one of the biggest victories in NoMi's response to the foreclosure crisis: The successful prosecution of the TJ Waconia fraudsters. When Streitz said that they were in federal prison, the room erupted in applause. Let's hope that the principals from Danna D III (who face federal charges) and maybe a few others will join them.

Streitz also gives some common-sense suggestions about how regulations around NSP dollars could be lifted to make our response to the foreclosure crisis even more effective. I have to agree with those comments, and will likely do a commentary about this at a later time.

Whew! That's about all the excitement I think we can handle for a while, but there was a second panel as well. That panel had some very poignant stories, including one from a tenant whose landlord went into foreclosure. Stay tuned to JN-SPAN.