Go back to The Man Who Owns Flint

Genesee County, Michigan, treasurer Dan Kildee

Dan Kildee is the treasurer of Genesee County, Michigan, and the chairman of the Genesee County Landbank. He has aggressively used Michigan's tax foreclosure law to take title to thousands of blighted properties in the city of Flint. His work has become a national model for how to handle the problems of vacant and abandoned properties in declining cities. I met with Kildee in the Landbank's newly renovated headquarters in downtown Flint to talk about what lessons Flint has for other cities.

Kildee

You're now involved in some pretty heavy development and community planning work. How is it that the county treasurer ended up doing all this?

I'm the foreclosing governmental unit. That's what we call it in Michigan, 70 out of Michigan's 83 county treasurers take title to property that's foreclosed for taxes. And there's this moment of time when the title is in the hand of the treasurer, and it's up to the county to decide: Do we want a passive or an active role in determining the use of the land? In our case, it was a no-brainer that we had to have an active role, because we could see what 35 years of passivity had done to our landscape. It's just a necessity for us to do this stuff. I don't really see it as being an extension of the treasurer's role. It's just that the treasurer's role has changed. Over time it will mean a different kind of person would run for this job, because now it comes with different responsibilities.

Part of your model is to sell your more marketable properties out in the county so that you can put the cash to work in Flint. Why should people in the suburbs care about Flint?

Sometimes they don't, honestly. But what we found is that, first of all, what we're asking from them is relatively modest. And second, in some cases they really do understand that the conditions in Flint ultimately have an effect on the value of properties within the whole region. If you live next to an abandoned house, the value of your home is significantly diminished. And at the macro level, if your community is next to the city of Flint, values in your community are reduced. Some local leaders in the region get that, and they're willing to make a modest investment to give us a chance to improve what is tantamount to the house next door.

We think of it as a way to return the favor of the last century, when Flint was the place where the wealth was derived, and it grew all of these suburban communities over a period of decades. Now the shoe's on the other foot. The wealth lives in the surrounding communities and that's where the land values are greatest. So there's some symmetry to the idea that the region now has to take some responsibility for the core community.

During his recent election campaign, the mayor of Flint took to calling you a slumlord. How do you respond to that?

We get the property because it's dilapidated. We get the worst stuff. When I'm trying to persuade other counties to take this on, especially in weak markets, this is exactly the push back I get. Why would I want all this junk? Why do I want responsibility for all this vacant and abandoned stuff? If there was no landbank and we didn't have an agreement that we'd deal with all the junk, we'd just hold a big auction and sell what we could sell. But the truth of the matter is that the property is going to sit there in your community. Just because the county doesn't own an abandoned property doesn't mean they put it on the back of a flatbed truck and move it to the state capital. It's still sitting right there, over on Avenue A, and the citizens we work for still have to live next to it. The frustration I have is that this whole area of policy is the easiest thing in the world to ignore. It's the easiest thing not to take responsibility for.

I've written some about the so-called "shrinking cities" movement, which has most famously taken root in Youngstown, Ohio. The idea is that post-industrial cities that have lost, in some cases, half of their population would stop fighting to restore their past grandeur, and instead plan deliberately for a future as a smaller city with a good quality of life. How does what you're doing in Flint fit into that thinking?

Youngstown has things we don't have. What they do have is a political leader who is willing to stand up, as a mayor of the city, and say we can be smaller and better and embrace that idea. That's the biggest challenge to a shrinking city is to acknowledge that dynamic and embrace it. Youngstown could be helpful to us. If Mayor Jay Williams came to Flint, he could help us get our heads around that idea.

One piece we have that would help Youngstown is this mechanism. They don't have an effective mechanism now to get control of the land and make decisions for the abandoned properties they have coming through their system. They're still subject to the tax lien sale. That's the thing we've been trying to get them to embrace-to reinvent their tax collection system and impose a different set of priorities on the process. And then when Youngstown does try to reduce its overall footprint, those properties that come through their tax system can contribute to the design of that smaller footprint. All this has to be viewed in a time frame that exceeds the typical political vision-five, ten, 15 years. Over time, you can take properties that used to just recycle through the system and look worse every year, and turn them into something that looks intentionally green and natural.

You've been taking title to about 1,000 properties a year. How long will that go on, and how will the national mortgage crisis impact that?

This really speaks to the challenge we face, but also the importance of what we do. The number of tax foreclosures was going down every year for first 4 years we were doing this. Then last year we had a little bump. A couple of indicators cause us concern. Delinquencies are up. And the number of mortgage foreclosures are up, which in our case does connect to our work because mortgaged property below a certain value sometimes ends up subject to tax foreclosure because the mortgage company just writes them all off. Combined with the overall weakness in the real estate market, I'm worried that we'll see more property. Now, I worry on the one hand, because that means it's our problem. On the other hand, I feel like at least we have the mechanism in place to deal with it.

One could argue that Flint's decline is a special case-the city was so dependent on one employer, General Motors. What is Flint's lesson for the rest of the country?

I think lesson number one is don't wait until your problem is so great that you've got the problem we've got. Flint waited way too long, and it's made our work very hard. But if you're Grand Rapids, Toledo, or one of the other functioning markets that are threatened, do it now. Make the changes in your tax foreclosure system now. Benefit from our experience. This was a rich town. Flint was the auto producer for the world. We had the world by the tail and knew it would never end. But a lot of that wealth has evaporated, and behind it is this legacy of abandonment which is really, really costly.

The frustration I have is that what we're doing would work so much better in other cities where the market is stronger. Because they still have the delinquencies to deal with on the front end, but the economics of that system are much better, because the product that goes through the pipeline is going to come out into a stronger marketplace. Theoretically they'd be able to engage in much more development than we've been able to.

© 2008, Congressional Quarterly, Inc. Reproduction in any form without the written permission of the publisher is prohibited. Governing, City & State and Governing.com are registered trademarks of Congressional Quarterly, Inc.