Today, Rep. Danny K. Davis, a Member of the House Committee on Oversight and Government Reform, issued the following statement about a lawsuit filed against the City of Chicago by the Federal Housing Finance Agency (FHFA), the conservator of Fannie Mae and Freddie Mac, attempting to block a city ordinance that would require these entities to pay for maintenance costs of vacant properties they own or have financial interests in:
"It's outrageous that Fannie and Freddie are sticking Chicago with their tab for failing to maintain these properties. This will have a devastating impact on municipal budgets, neighborhood property values, and the safety of communities across the entire country."
At Davis' request, Committee Chairman Darrell Issa has agreed to hold a field hearing in Chicago. Davis plans to submit a formal request for the hearing to focus on the failure of mortgage servicers and FHFA to properly maintain the growing number of vacant and foreclosed properties nationwide.
A recent report by the Government Accountability Office (GAO) found that vacant properties increased 51% nationally, from 7 million in 2000 to 10 million in April 2010. The report also found that local governments expended millions of dollars on vacant properties that were not adequately maintained. In Chicago, for example, City officials told GAO that major banks owed millions of dollars in fines for failing to properly secure and register vacant properties.
GAO examined data on vacant residential housing units nationwide, including in Baltimore, Maryland; Chicago, Illinois; Cleveland, Ohio; Indio, California; Detroit, Michigan; Indianapolis, Indiana; Las Vegas, Nevada; Cape Coral, Florida; and, Tucson, Arizona.