Blight Package Reintroduced in Senate; Includes Financial Institution Exemption

Posted on March 4, 2013 by nbrown

A package of bills to help local communities address blighted property was re-introduced from last session. The bills are SBs 35-39. Here is a summary of the bills: 

  • Senate Bill 35 would allow cities that use administrative hearings bureau to adjudicate blight violations to establish additional civil and criminal penalties on a person who committed a blight violation and failed to pay a fine and costs of $1,000 or more. It would also lower the minimum population to be eligible to have an administrative hearings bureau from 2.0 million to 1.5 million for a county containing a city with a population of 3,300 or more. This bill also exempts financial institutions from the fines and penalties that other individuals would otherwise be subject to so long as they are adhering to the property preservation guidelines of Fannie Mae, Freddie Mac or specific US Governmental entity. It also states that a credit union is not subject to these same fines and reprimand as long as it provides the mayor of the city with an address and list of the credit union’s foreclosed properties at least once every six months.
  • Senate Bill 36 would amend the Michigan Zoning Enabling Act to allow a city zoning ordinance to provide that a person would be ineligible for rezoning, site approval, or other zoning authorization if the person were delinquent in paying a fine or costs for a blight violation.
  • Senate Bill 37 would amend the Single State Construction Code Act to allow a city to provide by ordinance that a person would be ineligible for a building permit, certificate of use and occupancy, or a variance if the person were delinquent in paying a fine or costs for a blight violation.
  • Senate Bill 38 would amend the Revised Judicature Act to allow a city to file a garnishment action if a fine or costs were ordered for a blight violation.
  • Senate Bill 39 would amend the Home Rule City Act to allow a lien against property involved in a blight violation to be foreclosed in a city’s administrative hearings bureau.

While the League is supportive of tools to help local communities deal with blighted properties, the League has major concerns with the financial institution exemption in Senate Bill 35.  They should be held to the same standards as all other individuals when it comes to blighted property. 

If you have any specific examples of where financial institutions are contributing to the blight problem in your community please send them to me so I can add them to our running list in an effort to have this language removed.  Also, do any of your communities have agreements that work well between you and the banks that could now be in jeopardy if this exemption language is passed?

Nikki Brown is a Legislative Associate with the League handling economic development and land use issues. She can be reached at [email protected] or 517-908-0305.

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