My Word: Alberto Torrico

0 Comments | Oakland Tribune, Aug 11, 2008 | by Alberto Torrico

The human cost of the home foreclosure epidemic is often in the news.

Families suffer the degradation of losing their homes, and communities are sent into a tailspin toward blight brought on by unoccupied homes and falling property values.

Yet, there is also a broad and far-reaching consequence of this rash of foreclosures that goes beyond the individual's loss and to the overall community.

Local governments, along with other regional providers, face a staggering loss of property tax revenue that will cripple their ability to provide necessary services.

Local property taxes are the lifeblood of many community organizations and agencies.

When homes are foreclosed, the value of the surrounding properties drops significantly and the loss of revenue can severely impact these local service providers. Utilities, public safety, fire protection, parks and recreation, pollution control, health care facilities, and other services often get at least some of their funding locally and subsequently all will have less money than usual to provide services many take for granted.

In Alameda County alone, the county assessor reports that while the overall value of assessed property has grown, it is growing only half as fast as the previous year. As of April 2008, home foreclosures are up 213 percent from last year, and this year the assessor reduced the value on 44,212 properties, or about $3.1 billion in lost property value. That $3.1 billion cannot be assessed to provide funds for the region.

In an era where overhead costs keep going up, government income from property taxes will have a hard time keeping up.

In Fremont, Union City and Newark, local service providers are faced with a combined loss of revenue of nearly $7 million. Schools, redevelopment agencies, special districts, as well as the operation of the cities and county, will have to make due with millions less.

Nationwide, the wave of foreclosures continues unabated. In June, home foreclosures were up nearly 53 percent, with more than 250,000 properties foreclosed. California ranked as the second hardest hit state in the nation, with one in every 192 households filing for foreclosure.

While the situation is dire, at least in California, there is hope that this problem will slow down with the passage of Senate Bill 1137, by Senate President Pro-Tem Don Perata (D-Oakland).

The bill, on which I am a co-author, makes it easier for lenders and borrowers to communicate effectively, and helps with the modification of the terms of certain mortgages.

Also, I am carrying AB 2586, currently in the state Senate, which would make it easier for tenants, the truly innocent victims of the foreclosure crisis, to maintain utility services and to reclaim their security deposits.

If signed into law, this bill would clarify tenant protections and give renters more security during a stressful time.

It is clear that foreclosures are both a personal and public crisis. Bills like AB 2586 and SB 1137 are good first steps, but there is still much work to be done.

I intend to remain vigilant in searching for legislative solutions that help families and communities through this foreclosure crisis.

Assembly Majority Leader Alberto Torrico represents the 20th District, comprised of the communities of Fremont, Union City, Newark, Milpitas, and portions of Hayward, Castro Valley, Sunol, Pleasanton, and San Jose.