An East Baltimore Woman Learns the Hard Way That You Can't Fight City Hall
But the strange visitors and lost possessions aren't Jacobs' greatest concern. Most troubling to her is the blight the vacant house has become on the East Baltimore neighborhood she's called home for more than 40 years. So when 1602 N. Milton popped up in the listings for the city's annual tax sale last year, she saw an opportunity: She would snap it up for a relative song, spruce it up, and restore one small piece of pride to a once-tidy block that today has nearly a dozen vacant houses and only a handful of resident homeowners.
Last summer, Jacobs paid off the city's lien on the house, giving her first dibs on acquiring it should the owner fail to repay her the lien amount in a timely manner. She purchased fire and flood insurance. ("Every time you looked at it there was a flood," she says.) Within months, she reckoned, she'd have a contractor in and soon thereafter a new home. When the time came, she'd also have built-in convalescent care; once she moved in to 1602, her daughter would take over Jacobs' old house and help care for her.
"I thought it would be easier if I went ahead and purchased the house," Jacobs, 71, says. "I thought I could help the neighborhood."
But a year after that tax sale, Jacobs still lives in her old house at 1604 N. Milton, and 1602 remains vacant and decrepit. Her attempts to navigate Baltimore City's finance and housing departments and the U.S. Department of Housing and Urban Development (HUD), which owns 1602, has cost her $1,600--and any sense that housing officials have her neighborhood's best interests at heart.
Edna Jacobs' story doesn't reflect a trend, or the failure of a specific government agency. But it shows how hard it is for an individual to make a difference on her own, by acquiring and rescuing vacant properties--and how the city and HUD, in their efforts to deal with Baltimore's glut of abandoned houses, often make the problem worse. The house next-door to Jacobs' is a physical danger to neighbors and a den for illicit activity, and she's put up her money and time to change all that. But her small bid to improve one corner of her community is hopelessly bogged down in a bureaucratic culture unable to see the forest of neighborhood development for the trees of protocol.
Jacobs bought her house at 1604 N. Milton in 1960. By 1974, juggling numerous housekeeping jobs, she had paid off her mortgage. Her four children, two of whom she put through college, have helped her maintain the house since, and today plenty of white and light wood furnishings, framed family portraits, and silk flowers make it a bright oasis in a bleak stretch of East Baltimore.
At one time, Jacobs recalls, 1602 was also a decent house and somebody's home. An older lady lived there; when she died, her granddaughter, a real-estate agent, moved in. But the granddaughter sold the house in the late '90s, Jacobs says, and after that it started to slide. The new owner did little upkeep and fell behind on his federally insured mortgage. According to the Maryland Department of Assessments and Taxation, HUD foreclosed on the house in May 1999, adding 1602 to the city's list of 50,000-some vacant homes.
HUD managed the property at arm's length via a private California company, and before long illegal activity and vagrants moved in. After trying unsuccessfully to get the city to keep the house boarded up and to enforce its no-loitering law, Jacobs considered buying it herself. She wrote Michaelson, Connor & Boul, the HUD-hired management company, and offered to buy the house "as is," but says she "got no answer at all."
So when she saw 1602 advertised in The Sun as one of nearly 20,000 properties up for grabs at the city's annual tax sale last spring, Jacobs again made plans to acquire it. She scraped together the nearly $900 it would take to pay off the city's outstanding lien and cover a year's worth of property taxes, and was prepared to take out a large loan to renovate the house. (One estimate she secured pegged the rehab cost at $20,000.) On July 10, 2000, she made the $891 lien payment and was given a certificate of tax sale by the city. To cover interest and legal and title-search fees, she had to front another $722.
The holder of a tax-sale certificate can foreclose on the property and acquire it if the owner doesn't repay the lien amount, plus 18 percent interest, within six months. In the case of vacant properties, the window is shortened to 60 days. If the owner doesn't step forward in time, the certificate holder has up to two years (one year for a vacant property) to initiate foreclosure proceedings in Baltimore City Circuit Court. If the owner still doesn't respond, the certificate holder can seek a court order mandating transfer of title. The tax-sale process is an easy way for the city to collect outstanding debts and a quick way for investors to make big bucks on the high interest. But those investors rarely intend to use the properties; for Jacobs, who did, the process has meant nothing but lost money and hopes.
Her attempts to collect the lien repayment from the house's owner--HUD--went nowhere. Her calls to the agency went unreturned, or she got bounced around real- estate agents and title companies that work on HUD's behalf. In January, she says, one agent told her the house was being set aside by the city under a home-ownership incentive program targeting teachers and police officers, "but I didn't see anybody [at the house] after that." She hired a lawyer, who also got nowhere. And as far as Jacobs knew, time was running out. The house was vacant, which she took to mean that she had until mid-May--one year from last year's tax sale--to foreclose. Her lawyer advised against that route--it could be costly, and there was no guarantee the court would award her title.
Finally, in March, Jacobs wrote a dozen-plus public officials, from Maryland's U.S. senators to the Governor's Office of Minority Affairs, to see if they could help her acquire the house or get her money back, only to keep running into passive resistance. Each time, she was referred elsewhere, to one local politician or housing inspector or another. Ultimately, in a March 26 letter, G. Louise Green, chief of the city's Bureau of Treasury Management, informed Jacobs that she could not be reimbursed. "Although we fully sympathize with you, and know that you were hoping to better the neighborhood by purchasing the property, we are unable to comply with your request for refund of the money that you paid for the Tax Sale Certificate," Green wrote.
Technically, at least, the door hasn't shut on Jacobs' bid to acquire 1602 N. Milton. According to one city housing-department official, a vacant-house notice wasn't posted on the house until Sept. 29, 2000, well after the tax sale. As a result, he says, Jacobs can technically claim that the two-year window applies to her, giving her until May 2002 to foreclose. "But HUD being the owner throws a whole different wrinkle" into the situation, the housing official says.
HUD spokesperson James Kelly says buyers must go through a real-estate agent, not the federal agency itself, to buy one of its houses. The house next to Jacobs is indeed for sale, he says, with a price tag of $9,000. Should the house sell, Kelly says, HUD would have to satisfy Jacobs' lien at closing. "Michaelson, Connor & Boul shouldn't generally allow the property to actually be acquired by the person who bid the taxes," he says. "What it should be doing is maintaining the tax status of the property. It's probably unusual for a [HUD] property to go to tax sale. It probably shouldn't happen."
As for 1602 N. Milton's open door and state of disrepair, he says, Michaelson, Connor is "supposed to be managing the property."
At this point, Jacobs is far less interested in taking over that burden than she is in getting her money back. In a March 16 letter to the Maryland Real Estate Commission, she wrote, "I only want what I gave the city, $891.01. . . . If I cannot have the house, why won't they refund my money?"
"I just figure that, you know, they don't want to do business," she says. As for going to court to foreclose, she's not even considering it, because "nothing says that even if I do that I would win. I know this--you can't fight the government."
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