ALAMEDA COUNTY AFFORDABLE HOUSING PROPOSAL

By R. D. "Rusty" Jackson

EXECUTIVE SUMMARY

The Alameda County Treasurer/Tax Collector administers the Tax Defaulted Land Sale annually. This statutorily mandated event requires public auctions for properties that are at least five years delinquent in the payment of their property taxes. The Alameda County Tax Defaulted Land Sale program is designed to maximize the utilization of a program of this nature already within the purview of the Alameda County Treasurer/Tax Collector. The program outlined in this paper proposes to expand the current program and provide guidelines for the broadening of the aforementioned program. The new expanded affordable housing initiative would provide for the involvement of the appropriate local elected officials as the catalyst for initiating the program services.

BACKGROUND

Once a year the Alameda County Treasurer/Tax Collector administers a public auction to sale properties that are delinquent with payment of their property taxes for at least five years. The minimum bid for said properties is the amount of delinquent taxes due to Alameda County. Generally, most if not all auctioned properties sale for an amount that is significantly greater than the amount of delinquent property taxes. Real estate investors and speculators are willing to pay many times the amount of the delinquent property taxes in hopes of acquiring the property. They are also willing to provide whatever repairs or upgrades and needed to have the property for sale. Generally, the subject property sales at the market rate which is often above the means of moderate income and many first-time home buyers. This new tax defaulted land sale program will create new opportunities for moderate income and first-time home buyers to participate in home ownership.

PROGRAM OBJECTIVES

The objective of the Alameda County Tax Defaulted Land Sale Affordable Housing Program is to utilize selected properties scheduled for the public auction to be used for affordable housing. The County Treasurer/Tax Collector will make available to all City Council members in Alameda County cities (and the unincorporated areas) and all County Board of Supervisors members (whose district encompasses a tax defaulted property) the list of delinquent properties scheduled for the public auction. If a City Council member whose district includes the subject property wants the property to be utilized for affordable housing they would contact the appropriate Board of Supervisor member and request that the subject property be removed from the public auction and utilized for affordable housing. This request would serve as the initiation to set in motion the program of creating additional affordable housing.

Presently, Alameda County has a program that allows non-profit organizations and/or developers to request to have property removed from the public auction and sold to them for the amount of delinquent property taxes. This program is greatly underutilized primarily because of its lack of exposure and narrow parameters for participation. This program has generally been utilized by certain non-profit developers to create multi-family housing and very little if any single family housing. This program is designed to put the emphasis on the creation of single family affordable housing.

Additional possible expansion or changes to the existing program include allowing individuals to purchase tax defaulted properties as long as they enter into an agreement with the County that the property be used exclusively for affordable housing or some type of first-time home buyers program. This program also would explore the option of utilizing the Section 8 Mortgage Program as a vehicle to place moderate income families in home ownership. The Federal Home Loan Bank possible offers additional programs to help the affordable housing participant.

ADVANTAGES OF PARTICIPATION

The primary statutorily mandated requirement of Alameda County is fulfilled because they receive the amount of delinquent property taxes due. Additionally, the County has a property back on the tax roles and therefore again generating property tax revenue. The City Council member that initiates the process for the property in particular and the home City in general is happy because of the creation of new affordable housing the their City. The moderate income or first-time home buyer is happy because they have realized their dream of home ownership. The expanded program with the new emphasis on single family dwellings creates additional possibilities for more affordable housing becoming available.