Five years ago Atlantic County was suffering the double whammy of a severe national recession and the closing of four Atlantic City casino hotels due to the rise of regional gambling competition.
Atlantic County led the nation in home foreclosures, which gave rise to zombie properties -- vacant or abandoned houses left unmaintained and often host to squatters. This of course made rebounding locally from the downturn harder, discouraging buyers and investors from the property market.
We praised two different approaches by local government to address the problem of vacant or abandoned properties, and in the headline for that editorial we said “time will tell which is better.”
After an unambiguous ruling last month by a New Jersey Superior Court judge, the winner clearly is Pleasantville.
Atlantic County and Egg Harbor, Hamilton and Galloway townships had hired a Florida-based company experienced in tracking down those responsible for abandoned properties, Community Champions Corp., also known as Pro Champs. The owners were then charged fees to register their properties and fines for failure to do so, generating more than $2.6 million in revenue for the governments.
In 2019, a Maryland mortgage company sued the county and townships over the validity and constitutionality of the ordinances adopted for the program.
Judge Julio Mendez noted the legitimate interest in addressing vacant and abandoned properties, but didn’t mince words in striking down ordinances and what he called “a revenue scheme.”
“Setting registration fees from $300-$1,000 a year, and the fines from $500-$1,500 a day, without providing a scintilla of evidence as to how these numbers were computed and determined, is the definition of arbitrary and capricious,” Mendez wrote in his ruling.
He said the court was also “greatly concerned” that mere defaults on mortgages were enough to target financially vulnerable homeowners.
Pleasantville tackled the problem by creating its own registry of emptied homes. After arranging a street-by-street survey to find them, the city notified owners of abandoned or vacant properties that they must be maintained, secured, posted with contact information, and registered with a $500 fee.
Once identified, the city's code enforcers, police and public works staff could work together to minimize the public-safety and health risks empty and neglected properties might pose. Police found some places taken over by gang members, for example, and after getting them out public works boarded up the houses.
Pleasantville had collected just $60,000 at the time to help cover its expenses, a fraction of what the townships took in. They and the county, though, look like they’ll have to return money now.