As Mayor Sandy Stimpson’s administration cracks down on blight, a January lawsuit between a Colorado-based developer and the city over an abandoned apartment complex seems to be nearing a resolution.
Legacy Capital Partners was the named defendant in a lawsuit the city filed in January to have a group of buildings off of West Prichard Avenue demolished. The suit asked the defendants to tear down the buildings at Joel Court, which the Mobile City Council declared a nuisance Jan. 30.
Keri Coumanis, an attorney with the city’s legal department, said Joel Court was, at one time, an affordable, multi-family housing complex with financial support from the U.S. Department of Housing and Urban Development (HUD). When the previous owners walked away from the property, HUD sold it to the defendants, Coumanis said.
“They foreclosed on it and did nothing,” she said.
Early this year, the city moved forward on a nuisance claim and had the City Council declare it blighted in January, Coumanis said. The city would normally tear a nuisance property down if an owner refuses to pay to fix it up, but because of the number of buildings on the Joel Court lot, the demolition would have cost close to $200,000, Coumanis estimated.
The city could’ve put a lien on the property, but an owner is not forced to pay it, she said.
“That was cost prohibitive because the demolition was so expensive,” Coumanis said.
Instead, the city filed suit as a way to “force their hand,” she said, funding the demolition by way of a judgment.
According to court records, the city sent two legal notices to Legacy about the property before the suit was filed. Legacy claimed it deeded the land to Flatirons Community Church of Lafayette, Colorado, in October. In an email message, Flatirons Community Church Chief Financial Officer Michael Koehn wrote that the church gifted the property back to Legacy, although he didn’t disclose any additional information.
A person who answered the phone number listed for Legacy Capital Partners, who refused to give his name or details, said the group had since donated the property to a local entity called New Ship of Zion Church.
Joseph Bonner-Bey, apostle of New Ship of Zion, said the church spent $125,000 in the past month having the blighted buildings on site torn down. He said the church has plans to build a new apartment complex on the site.
Bonner-Bey, who was on the site last Friday helping clean up debris, said the non-denominational church acquired the property about four weeks ago and is trying to have new housing constructed by October. The proposed units, Bonner-Bey said, would consist of market-rate and subsidized housing. The church also owns property next door he hopes will attract a dollar store to the development.
Coumanis said the city is waiting until all the debris is picked up and the grass is maintained on site before it drops the suit. She suggested legal claims like the one against Legacy could be used more frequently by the administration to fight blight.
Mobile currently has between 3,000 and 5,000 blighted properties.
Last week, Joan Dunlap, the executive director of the mayor’s grant-funded Innovation Team, presented a plan to combat blight to the Mobile City Council.
In the presentation, Dunlap outlined four main causes of blight in the area. One common problem is negligent landlords, she said, many of whom are willing to go to court and cost taxpayers money. In the new effort, she said the city would make going after negligent landlords a priority.
Medicaid liens are another issue, she said. Medicaid liens occur when medical bills exceed the value of a home. There is currently no Medicaid lien foreclosure process, but the city is working with administrators of Medicaid to find solutions to this problem, she said.
Neighborhood decline and heirship issues also plague blighted property in the city.
Coumanis previously stated in an email message that the city has successfully purchased tax deeds on 67 parcels, for the city’s landbank. Of those, three were redeemed from the city. Of the 64 remaining properties, 22 have been sold and three have been transferred to the city for municipal purposes.
There are 29 properties in various stages of litigation, Coumanis wrote. Three or four are pending in Mobile County Circuit Court. The remainder have not yet been filed.
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