Foreclosures can be reduced

Date: 11/16/2010

Nov. 17, 2010

By G. Michael Dobbs

Managing Editor

SPRINGFIELD -- Slowing down or reversing the foreclosure rate in Springfield goes beyond just real estate, according to speakers at "Restoring Prosperity: Rising to the Foreclosure Challenge," a conference presented by HAPHousing Inc. at the MassMutual Center.

Solving the foreclosure and vacant property problems is something that will take years to accomplish and must be part of an over-all effort to address development issues, Peter Gagliardi, the executive director of HAPHousing, told Reminder Publications.

Gagliardi said that filling empty houses is part of the issue of working toward a plan for the future.

"How do we envision the city in the next 25 years?" he asked.

Springfield has a foreclosure rate four times greater than the state average and, while Gagliardi lauded projects such as the redevelopment of the South End and the reconstruction of State Street, he said that housing was not considered when developing those projects.

"Housing needs to be at the table," he asserted.

Alan Mallach, a non-resident senior fellow at The Brookings Institution and senior fellow for the Center for Community Progress, told the several hundred attendees "despite the overwhelming nature of the problem, strategies can be adopted."

The boom in the sub-prime lending market, the "incredible price bubble" of housing prices and the number of homes outstripping demand all contributed to the foreclosure emergency, he said.

Although he noted the efforts in Springfield to address foreclosure, the city's housing condition is like "the classic pig in a python." There are 1,800 foreclosure cases in the city that are unresolved and one in every 30 to 40 homes in "foreclosure limbo."

Mallach said, "The key charge is how can we strategically move the housing market in Springfield."

He believes a comprehensive plan to build consumer confidence and demand in Springfield must be developed. That plan must address ways to prevent future foreclosures; require reuses of vacant properties; reduce the link between foreclosures, disinvestment and vacancy; address issues of speculation and crime; and enhance the overall quality of life in the city.

Mallach said any plan the city adopts must include a wide selection of stakeholders and mist be designed for the long-term.

"The problem accumulated over many decades," he said.

Yolanda Kodrzycki, vice president and director of the New England Public Policy Center of the Federal Reserve Bank of Boston, is also a senior contributor to the bank's "Toward a More Prosperous Springfield" program. She told the audience the bank has studied 25 peer cities of Springfield in an effort to create redevelopment strategies.

Of those peer cities, there are a number the Federal Reserve Bank has classified "resurgent cities," communities that have reversed somewhat the downward rates of income and decreased the rate of poverty.

She noted that resurgent cities are still lower than the average in the nation for income and poverty.

In New England, those cities include Worcester, Providence, R.I. and New Haven, Conn. She explained the "fundamental transformations have taken place over decades."

Long-term collaborations that include participants from many sectors and that transcend one particular mayoral administration are vital to the process, she explained.

She emphasized that Springfield doesn't have any disadvantage when compared to the qualities of the resurgent peer cities.

She explained the resurgent cities have promoted themselves well in coordinated efforts and the higher education communities in New Haven and Worcester, for example, have made concerted efforts to become involved in development issues in those cities.

She said Springfield has "no inherent obstacle" to resurgence such as its peer cities.

Gagliardi said the redevelopment of the city, which includes addressing the foreclosure problem, is "an on-going process, not a destination."

A new Web site, www.communityintersections.org, has been launched by HAPHousing to act as a central pint for information on the issue, he added.