Vacant Property Registration Ordinance moves on to the next step

The Havre City Council Ordinance Committee took the next step Tuesday in imposing additional regulations on vacant properties in the city.

The Ordinance Committee voted to send a proposed vacant properties registration ordinance to the city attorney for legal review and agreed to look further into the situation, with the possibility of sending the proposal back to the ad hoc committee to write an official draft of the ordinance.

Before the vote, Mayor Tim Solomon and Ordinance Committee Chair and City Council President Andrew Brekke raised concerns of the legality of the proposed VPRO and the city's ability to enforce the ordinance, saying many cities in Montana are not implementing those regulations.

The council created the ad hoc committee in June 2017 after Montana State University-Northern grant writer Samantha Clawson raised concerns at council meetings about vacant properties being allowed to deteriorate. Her concerns included multiple properties that Sunrise Financial had obtained by buying tax liens and then refusing to sell to interested buyers or asking high prices and not maintaining the properties.

Clawson was appointed to the ad hoc committee.

The city previously had said Sunrise, and owners of other vacant properties in Havre, were not violating any laws, leading to Clawson's bringing up creating some kind of ordinance.

Sunrise recently has hired contractors to do work on some of the properties it owns in Havre.

Council member Caleb Hutchins, a member of the ad hoc committee and Clawson's husband, said that the ad hoc committee found that VPROs have proven effective in other parts of the country and that they give property owners incentive to maintain or sell properties that are vacant. Hutchins added that the ad hoc committee also came up with a list of features of what a VPRO in Havre would look like and how it would be beneficial for the community.

The features include defining a vacant building, creating a mechanism for registering vacant buildings within the city, creating mechanisms for enforcing the VPRO and creating mechanisms to allow exemptions for vacant property registration.

Hutchins said the VPRO would not be set up to punish people who seasonally occupy a property; owners who maintain the external appeal of the building but who lack tenants or renters, or properties damaged in fires or natural disasters, and added vthat it would be possible for the property owner to apply for an exemption if needed.

"This will have a positive impact on the properties in question around town," he added.

Hutchins said it is well-established that vacant properties lower property value, increase crime and increase pests in the surrounding area. He added that it is worth looking further into the possibility of a VPRO.

Solomon said what he wanted from the committee was to research more of the legality to enact any of the VPRO mechanisms and wanted to know what else was possible.

"There are going to be challenges," Solomon said.

Clawson said the committee had contacted two different sources to research legality of the ordnance, had contacted the city attorney and was told to take the VPRO to the Ordinance Committee

The ad hoc committee also tried to contact Montana State University's Local Government Center but was unable to connect with anyone, she added.

Hutchins said he has done some research into the legality of the matter and found nothing that would suggest the VPRO is in violation of any laws or rights. He added that the ad hoc committee has found that VPROs are the most effective tool that they had found nationwide.

Solomon said he wanted to know what state law gives the city government the authority to enforce the ordinance.

Brekke said that he had the same concerns with the ordinance. He added that Havre is the only Class One city with general government powers, which are very restrictive.

He said that other options they could have explored were special improvements districts and tax increment finance districts.

Brekke said that his concern is "how far we go."

Clawson said VPROs are the most successful nationwide, although not widely used in the state of Montana.

Hutchins said the tax increment finance district and the VPRO are complementary and not contradictory. He added that unmaintained vacant properties are "causing civic harm to our community."

"The one on Fifth (Avenue) is in danger of collapse at this point because of neglect," Hutchins said.

The ad hoc committee has researched VPROs in cities across the state as well as the country, Hutchins said. He added that the ad hoc committee was looking at communities with roughly the same population and semi-rural areas, communities close to Havre's profile.

He said the committee did this so it could look at what the ordinances were like, how they were written and what effects the VPROs had in those communities. Out of 12 communities examined, the one that stood out to the committee was Bellefontaine, Ohio, Hutchins said, which has had a VPRO on the books since 2015.

The VPRO has been very effective there, Hutchins added, and once-vacant properties are now back in working order and in productive use.

Jim Bennett, executive director of the Montana State University-Northern Alumni Foundation and member of the ad hoc committee, said he had spoken to the code enforcement officer in Bellefontaine and, during the first year, the city gave a grace period for the property owners and made strong efforts for public education. The officer said there were almost instant improvements since the ordinance was approved even though the ordnance wasn't active till the third year.

Bennett added that the officer said there has been an overall positive effect in the community and it pushed owners of vacant properties to make improvements or to sell the properties, although the ordinance is strictly concerned with the exterior appeal of the properties.

Clawson said something needs to be done.

"The time to ignore the VPRO issue has passed," she said. "I think the community is going to be very interested in ensuring that it is pursued until it's an obvious dead end or we are able to put something through."