Certain City Leaders Would Have You Believe That Property Values
In Jackson Are Increasing As A Result Of the Demolition Program
Here is a rather decent looking house in a nice area. Even
a city manager once rented here.
Like many other properties in Jackson
where prices are falling, this property seems to be benefiting from the negative
effects of the demolition /neighborhood stabilization program initiated by Pat Burtch
and the city council:
Sale Date 04/04/2002 Sale Price
Year Taxable Value
- 2012 $63,100
- 2013 $51,900
- 2014 $39,100
- 2015 $39,725
Are the values increasing as alleged by city
The original plan to stabilize
neighborhoods and increase property values through demolition was hatched in 2011 by
the team of Larry Shaffer and Patrick Burtch.
With Burtch serving as Community Development Director under City
Manager Larry Shaffer in October 2011,
the pair championed a new program they claimed would jumpstart Jackson's
One aspect of the initiative, they said, would be to demolish about
800 vacant and condemned homes. Most city officials reasoned demolition was favorable
over rehabilitation, estimating it would cost $9.8 million to demolish those homes and
more than $54 million to rehab them.
The program was implemented and included many disincentives for
investors and potential home owners to buy and rehabilitate properties to serve as
rental units and single family owner occupied homes. The proponents of this program
preferred demolition to private rehabilitation and preserving the tax base. They
alleged that clearing blight and demolishing homes would increase remaining property
values and reduce crime as a bonus
Contrary to these assertions by city officials, the results so far
show none of the supposed improvements promised. A recent article by the MLive/Cit Pat
editorial board suggested that sold as silver bullet
to cure many of Jackson's ills, the demolition program falls flat.
A further study by the CitPat/MLive staff found that not only has
crime not decreased as a result of the demolition program but that
property values have not increased after spending $3.1 million on this
A brief review of the city's own published data shows the
It is obvious that overall property
values have not increased and in fact have decreased after implementation of the
City officials both elected and appointed have tried to mask this
reality by citing a few statistics on a few properties which they neglect to identify.
The bottom line is that the tax base is eroding and with it tax
In the April 28th special budget meeting, city
manager Patrick Burtch stated that properly values are increasing in Jackson.
Councilman Derek Dobies chimed in adding that the demolition program is having a
positive effect on Jackson property values.
Mayoral candidate Laura Schlecte, a local realtor
added that studies by realtors show increasing property values most likely attributable
to the demolition program. No data supporting this claim was
Colin Cote, President of the Jackson Area Association
of Realtors, says he believes the program is in part helping raise the market values
all over the city. But in those neighborhoods where homes are demolished, positive
change is harder to quantify. "Homes that were selling for $50,000 two years ago are
now selling for $70,000 to $80,000," he said. "A lot of homes with lesser values –
$25,000 homes and the like – aren't seeing a huge increase, they need too many repairs
to begin with. "There's no way of knowing for sure, but the program is helping in
"In theory"? That is an excellent basis for predicting
the future course of home values in Jackson considering that
the data does not support this conclusion. Click the link above to see the real data for
all neighborhoods in Jackson
In a circular mailed out at great expense to 6th Ward
residents, 6th Ward councilman Derek Dobies stated that over 400 vacant and dilapidated
properties were demolished which has increased public safety and raised property values
based on sales statistics from "Jackson real estate professionals". No identity of the
real estate professionals who were the source of this claim was provided nor was any
supporting data provided.
some wards that have seen an increase of 90 percent in home values," Councilman
Derek Dobies, 6th Ward, said. "An economic turnaround alone doesn't produce numbers
Dobies is quite right on that point. An economic
turnaround does not produce numbers like that but misrepresenting the data does. There
is no ward that has experienced a 90% increase in values. Perhaps Derek was confused
and speaking of one house in one ward bought at auction for $4,000 and resold for $7600
after some rehab activities.
Burtch said Jackson's economy is on the precipice of
making a comeback under the Neighborhood Economic Stabilization Program, citing rising
market values and about $10 million worth of business investments coming down the
development pipeline as constructive results. City officials declined to name any
specific businesses expected to move into Jackson, saying it was too early in the
development process. The rising market values were not identified.
In June 2013, the U.S. Treasury signed off on a
proposal allowing the Michigan State Housing Development Authority to create a blight
elimination program using federal funds originally set aside for mortgage relief and
Cities such as Detroit, Flint, Saginaw, Grand Rapids
and Pontiac are beginning to ramp up their demolitions of vacant homes using federal
funds. "We're a model for the state," Burtch said.
After being turned down by CAA and the county land
bank, the city turned to the John George Home to manage the demolition program.
Contrary to program requirements, the John George Home has no background or experience in
managing demolitions as is required by the federal program. The only relevant factor is
that Burtch, Dobies and ex-Mayor Griffin are on the John George Board of Directors and able
to exert influence on the John George management to accept responsibility.
MSHDA set aside $75 million this year to fund
demolition efforts in communities across Michigan. Jackson is one of 12 communities in
line to receive a portion of those funds, with recipients announced Monday, Dec. 8. Up
to 400 Jackson homes could be bought and demolished using the federal funds which were
intended to help underwater owners and prevent foreclosures with the purpose of
stabilizing neighborhoods. Funds which were to keep owners in their homes are to be
used to demolish serviceable homes.
Michael LaFaive, director of fiscal policy at the
Mackinac Center for Public Policy, said federal lawmakers should have nixed the
mortgage relief and rehab program years ago, instead of "morphing it into a demolition
fund." "I don't blame the cities for applying for some of those funds," LaFaive said.
"I blame the feds for having the program in the first place."
As long as the city council supports this wanton
destruction of the tax base to support a vision of a resurrected downtown Jackson
peopled with "young professionals" scurrying from bar to bar, that vision is doomed to
failure and Jackson with it.
Police, crime rates and fire protection are high on
the list of desirable attributes when people look to places to move to. We know that
increased police presence reduces crime. Many studies support this
With regards to the demolition program in Jackson,
Chief Heins said the only gripe he has with the program, "from a self-preservation
standpoint," is how quickly city lawmakers are spending general fund dollars to
administer the program while policemen and fire fighters annually make union
In June 2012 for instance, Jackson fire fighters
agreed to a contract that set back wages for new fire fighters 10 years and cut pension
contributions nearly in half. In the same budget cycle, city officials transferred
hundreds of thousands of dollars from the general fund – money used to operate
Jackson's police and fire departments – into the demolition program.