Valley Stream officials to seek ‘zombie house’ grant money

Combatting blighted properties

The bank has to try to protect the asset too, now. Before, they hid.”

Bob Barra, Valley Stream Village Clerk

Village officials are preparing an application to the Zombie Remediation and Prevention Initiative, announced by the New York state attorney general’s office in July, to obtain funding to deal with blighted properties.

The grant program allocates a total of $13 million for relief efforts to eligible municipalities. The application process is competitive. It considers the proportion of abandoned properties to the size of a municipality (there are about 200 in Valley Stream), the level of economic distress and a town’s demonstrated interest in addressing the problem of housing vacancy.

Village Clerk Bob Barra said that Valley Stream is asking for $350,000 for personnel, vehicles and computers, and is considering establishing a task force to handle cases of abandoned homes. The state’s awards will be announced in September.

Village officials say they hope that any grant money, combined with a new law signed by Gov. Andrew Cuomo in June, will help reverse the problem. The legislation is designed to prevent foreclosures and ensure that, when they happen, the owner maintains the vacant property. Banks now face a $500-per-day penalty for failing to maintain properties they own. Barra said that the new law’s biggest benefit is that it establishes a contact for the village to follow up with, which he described as having been “impossible” up to now.

“They have to put up a bank contact, an attorney — someone who actually picks up the phone on the other end of the line,” Barra said. “Because the bank has to try to protect the asset too, now. Before, they hid.”

When attempting to contact banks, he said, he would often be rerouted to a call center outside the U.S. “There was an iron curtain up,” he said. “The banks didn’t want to do anything. ‘Oh, I don’t want to send [someone] there and spend $25,000 fixing that house up. The hell with ’em. I’m in Texas. What do we care about Long Island?’ That was their thought.”

Barra began threatening high-level bankers with summonses to hold them personally liable for the properties in disrepair, which became a preoccupation in the village after the 2008 housing crash. “I was spending probably 70 percent of my time on zombie homes [in 2014],” he said. That included sending letters to New York State Attorney General Eric Schneiderman.

Street Maintenance Inspector Nick Cassano said that many people don’t realize they still own the property when they move out of state. The village, he explained, must then issue summonses for homeowners to appear in court, which prolongs the process.

“I try very hard to track them down, because they’re given the wrong information, too,” Cassano said. “We had a lady … She moved to Pennsylvania. I contacted her and she said, ‘My attorney says it’s not my house anymore.’ Yes it is. It’s in foreclosure.”

Landlords who rent properties in Valley Stream but live elsewhere can create opportunities for squatters to move in, which further complicates the problem. “Once they’re in, they’re in,” Cassano said. “They have to go through the whole eviction process, just like they’re legal residents in the house.”

Two of the village’s worst zombie properties — on North Corona Avenue and North Cottage Street — have recently been patched up and readied for sale, but neighbors fear the prospect of more squatters. “This house here has been through three different banks,” said Gia Valentin, who lives next door to a vacant property on North Corona. She said she was grateful that the village stepped in and cut the grass, but she didn’t think enough was being done to prevent squatters from moving in.

Her husband, Berto, said the house has been a nuisance for seven of the nine years they have lived next to it. The Valentins said that a neighbor saw 10 squatters moving into the house several months ago and called the police. When officers arrived, they said it was a village matter and left.

“We pay a lot of taxes here, so we should be able to call and complain and get some help,” Gia said. “There has to be more monitoring of these things.”

They said they have noted suspicious activity that they believed to be drug-related and called police more than once. The squatters were kicked out in May after the property owner — who lives in Florida — got involved. As soon as the owner was contacted, Gia said, the village began ticketing him for a crumbling sidewalk in front of the house, but she wondered why the squatters weren’t ticketed.

“If I stopped paying my taxes,” Berto said, “they’d kick us out.”

While they anxiously await the sale of the property next door, Gia said, she and a few neighbors started parking their cars in its driveway — with the owner’s permission — to try to prevent more squatters from moving in. The nuisance prompted one of their neighbors to move.

“We know the banks eventually will get around to it,” Barra said. “We’re trying to avoid the blight; we’re trying to collect the taxes on them. We’re trying to hold the owners and the banks accountable as best as we possibly can.”

Some provisions of New York State’s zombie law:

• A document will be drafted informing property owners of their rights in foreclosure proceedings, to prevent people from losing their homes and to alleviate confusion.
• A Community Restoration Fund, or CRF, will help the state assist homeowners facing foreclosure by purchasing defaulted mortgage notes from other lenders and offering favorable mortgage modifications. 
• Banks will be mandated to sign a pre-foreclosure agreement to maintain vacant and abandoned properties, and will be fined $500 per day for not doing so.
• The foreclosing party will be required to move to auction within 90 days of obtaining a foreclosure judgment. In addition, the foreclosing party will be required to take action to ensure that the property is reoccupied within 180 days of taking title.
• An electronic registry of vacant and abandoned properties will be established to promote communication between local governments and mortgagees responsible for property maintenance.
• In cases where homes are vacant, the CRF will help complete a foreclosure and work with land banks and other local nonprofits to rehabilitate properties and resell them.

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