U.S. Rep. Danny K. Davis and Maryland Congressman Elijah E. Cummings sent a letter last week to the head of the U.S. House Oversight and Government Reform requesting a hearing in Chicago to examine the failure of mortgage serving companies to maintain the growing number of abandoned properties nationwide and its impact on taxpayers.
Cummings and Davis requested testimony from the CEOs of the nation’s top banks and Fannie Mae and Freddie Mac, as well as federal and local officials who have encouraged banks to better address vacant properties, including Chicago Ald. Robert Fioretti and Cook County Commissioner Bridget Gainer.
A recent report by the Government Accountability Office (GAO) found that vacant properties increased 51 percent nationally, from 7 million in 2000 to 10 million in April 2010.
The GAO reported that these abandoned properties attract crime, aggravate public safety concerns, decrease the value of surrounding properties and contribute to a loss of tax revenue.
The report found that local governments expended millions of dollars on vacant properties that were not adequately maintained or do not comply with local building or public safety laws.
Chicago officials told the GAO that major banks owed millions of dollars in fines for failing to properly secure and register vacant properties. They also informed the GAO that banks and mortgage servicing companies owe millions of dollars in fines dating back to 2008 for failing to secure and register vacant properties, among other violations.
The Chicago Reporter has determined that Chicago taxpayers have paid more than $30 million since 2008 to seal or demolish vacant properties.
Cummings and Davis proposed Jan. 31 as a potential date for the field hearing in Chicago at Malcolm X College.