Using legal tool, Belleville group shifts into high gear renovating derelict homes

A group of Belleville-area residents has been buying and renovating derelict buildings on the west end for 19 years, trudging through what can be an arduous process to protect their neighborhoods.

Now the group, called West End Redevelopment Corp., is using a powerful legal tool to help accomplish its goals.

“It’s a game-changer,” said board member Jacob Surratt, 30, a consultant in real estate and economic development.

The Illinois Abandoned Housing Rehabilitation Act allows nonprofit organizations to file lawsuits and get circuit courts to force owners of “nuisance” properties to bring them into compliance with local codes. If they decline, there’s a path for the organizations to take ownership.

If the owners can’t be found, organizations can take temporary possession and do the renovations themselves. Owners have two years to regain possession, but only if they reimburse the organizations for expenses. If they don’t, the organizations can take ownership, as long as properties are used to provide low- to moderate-income housing for 10 years.

Any of these scenarios keeps individual or corporate owners from letting vacant homes or commercial buildings further deteriorate into eyesores, according to Surratt.

“We’re being proactive instead of reactive,” he said. “We’re forcing these people to do something.”

In the past year, WERC has gone through St. Clair County Circuit Court to take ownership of two derelict homes, one at 300 S. 74th St. and one at 7100 Northern Drive. It’s working to take possession of two more at 121 Hazel Ave. and 4 Concord Drive.

Contractors and volunteers have removed overgrown trees and bushes from the 74th Street property, where a mid-century modern brick ranch had been barely visible. Inside, it features hardwood floors, a fireplace, panel doors and glass-block shelves.

Renovation is expected to start this spring.

“We’re going to make it a showpiece,” said board member Donna Veile, 61, a retired marketing director with AT&T.

Property ‘intervention’

West End Redevelopment Corp. formed in 2005. It covers an area bounded by Illinois 161, Frank Scott Parkway, Illinois 15 and Illinois 157, including neighborhoods in incorporated and unincorporated Belleville and a small portion of incorporated East St. Louis.

“The founders saw the deteriorating housing stock in the west end and saw an opportunity to have a non-governmental agency try to run some of the interventions,” Veile said.

WERC is funded through donations and grants and receives some assistance from the city of Belleville. It’s governed by a volunteer board of 12 people, chaired by retired contractor Tim McDermott and supported by about 300 donors.

The group has renovated and sold or rented 11 buildings and demolished six that were not considered salvageable, investing $920,311 in the community, according to its list of projects.

The average of about one project per year reflects the challenges of tracking down owners of vacant buildings, persuading them to sell at reasonable prices or sell at all, raising money and coordinating renovations with contractors and volunteers, Veile said.

Every situation is different. Some people hang onto childhood homes for sentimental reasons. Others delay maintenance and die with no descendants. Some investors, including anonymous limited-liability companies, buy blocks of properties then disappear.

WERC is particularly interested in vacant derelict homes that are bringing down property values in otherwise nice neighborhoods, said board member Mark Schmitz, 63, who’s retired from the U.S. Air Force and a second career in software development.

“While property ownership is a fundamental right in our country and Constitution, there are responsibilities that come with it,” he said.

New Jersey scam

One of West End Redevelopment Corp.’s most disturbing stories involves the home it’s trying to take possession of at 4 Concord Drive, according to Veile, who often passes by on her morning walks.

Veile’s research led to a New Jersey woman who told her that she went to a real-estate investment seminar where representatives of a management company persuaded her to use $480,000 of her retirement funds to buy five out-of-state homes, including the one on Concord.

“The sales pitch was, ‘People from China are coming in and buying the houses next door. We have to save our country. You need to invest in these houses. The president (Donald Trump) wants you to invest in these houses,’” Veile said.

The homes, which the company managed, provided income in the form of rent payments for a while, but after a flood due to a leaky roof on Concord, the tenants moved out.

Veile said the woman later learned that the managers hadn’t been paying property taxes and took out mortgages in her name; that she allowed a foreclosure to proceed; that Integrity Investments LLC bought the home at a county tax auction; and that its principal was willing to sell to WERC, but only if it would also buy several properties in Cahokia Heights.

“That’s just one story for one house,” Schmitz said. “Every house has a story.”

Some have been filled by hoarders. Others were occupied by squatters. The buildings that the group demolished left it with five vacant lots, which cost about $1,500 a year for mowing, insurance and taxes.

Illinois attracts real-estate investors from all over the United States with a system that allows them to earn high interest rates by purchasing delinquent tax bills on properties then back out of continued responsibility with a “sale-in-error” loophole, Surratt said.

“It’s very lucrative,” he said.

Little-known law

The West End Redevelopment Corp. board learned about the Illinois Abandoned Housing Rehabilitation Act from Jack LeChien, co-chairman of the Gustave Koerner House Restoration and former chairman of Belleville Historic Preservation Commission. He spoke at one of its meetings.

LeChien has long wished that a nonprofit organization like WERC could be formed in downtown Belleville to help protect neighborhoods from going downhill due to derelict buildings.

As for the rehabilitation law, he said, “Apparently, it just hasn’t been used that much. Groups didn’t know it was available.”

Neighbors often are concerned when they hear the requirement that some properties acquired and renovated by the nonprofit organizations must be used for low- to moderate-income housing, according to Surratt.

He explains that income levels are determined by medians across the entire St. Louis region, including wealthier suburbs, so a qualified resident could include a single person earning $53,150, an adult and child earning $60,750, or a family of four earning $75,900.

“This isn’t Section 8,” Surratt said, referring to the U.S. Department of Housing and Urban Development program for very low incomes.

WERC took ownership of the home at 300 S. 74th St. in December after filing a lawsuit in May and learning that three years of its delinquent tax bills had been bought by Raven Securities. The group paid owner Scott Sieron $15,508 to clear the title.

The white frame home with a stone facade at 7100 Northern Drive sat vacant for more than 30 years, except for cats and other animals, board members said. After WERC filed its lawsuit, a descendant of the late owner agreed to donate it to the group.

Board members haven’t made a final decision on whether to renovate or demolish that home.

“We’re still thinking it through,” Veile said.