The City's Council's Foreclosure Responsibilities

The Columbia Heights' City Council denies all responsibility for foreclosures in the City. The Council called foreclosures a threat to the City. The Council laid all blame for foreclosures on others. Nothing new there. The Council blamed banks, sub prime mortgage lenders, and individuals who took out mortgages that they could not pay.

“We the People” elected the City Council to take their oath of office and responsibilities seriously. We didn't elect the Council minus one because they had money, good looks, or joking ability. We elected them to warn us about the foreclosure problem when economists were predicting it years ago. Being Big Government fans, they surely know how the Federal Reserve Bank (a corporation) works. The Council knew what was going to happen and did nothing to prepare the City for an economic downturn, like lowering taxes.

The current economic problems that Big Government created was done by artificial lowering the interest rates. For our Central Government to lower interest rates, Central Government officials must ask the Federal Reserve Bank to inflate the money supply. The money supply was inflated by 100's of billions of dollars. Then the Central Government told banks to loan money to anyone applying for a mortgage, especially in poor neighborhoods. This meant loaning money to individuals unable to make mortgage payments if there were even a slight economic downturn. So much money was pumped into the economy, some people didn't know what to do with all of it. The 1929 euphoria was recreated. History buffs know what happened next.

Then cities like ours, used TIF (tax incremental financing) to take away the risk of development to developers. Metro developers created new commercial spaces and 10's of thousands of city inspired association controlled living units. To fill the new retail spaces, subsidies were given to the big boxes like Star Bucks, allowing them to under sell existing mom and pop stores. This pressured unique city businesses to consider bankruptcy. Older commercial space saw increasing vacancy rates causing their owners to default on their mortgages.

All the new condos didn't sell. In the 10 years before 2003, only 200 condos were built. People didn't want them. The last time real estate crashed, the price of condos did not recover for years after the price of private homes rebound. Why did the Council build high risk condominiums? When condos don't sell, they will be rented, pushing rents down, forcing apartment owners into foreclosure.

The city's TIF costs are hidden from citizens since the money to pay back TIF is taken out of the city's taxes before taxes show on a spreadsheet. The new City inspired development does not pay its fair share of taxes for schools, police and fire protection, libraries or other City services. This means higher taxes to existing home owners. These higher taxes translate into a higher foreclosure rate. Plus the City Council minus one can't wait to spend more using TIF with a recession coming. There are plans for more City commercial development. This will result in higher taxes and the closing of our familiar businesses. This goes beyond deliberate irresponsibility. This goes against their oath of office minus one.

Big Government blames corporations and individuals for Government created problems. Not surprisingly, Big Government is now, after the fact, attacking sub prime lenders. The lenders only did what Big Government asked. Our Council didn't have to be part of this scam. Now the City Council minus one are blaming the very people, they were voted to serve, for the foreclosures. When election time rolls around, don't accept Council excuses that they didn't know bad times were coming. Vote in citizens who will take City Council responsibilities seriously, not just to enrich best friend developers.