Palmyra residents push for higher penalties on vacant-property owners

A year and a half after Palmyra approved an ordinance setting fees and fines to stem the spread of vacant houses in the borough, some residents dissatisfied with the results are pressing for bigger penalties.

Mayor Karen Scheffler said she heard such pleas at a Borough Council meeting last month from residents of neighborhoods particularly affected by vacancies. Levying fees, she said, is the sole means the town has to incentivize sales of the houses.

The houses typically are caught up in foreclosure proceedings initiated by banks, and Scheffler said she was considering residents' suggestions to be more aggressive with the banks and increase the fees.

"It comes down to holding banks responsible," she said.

Borough Administrator John Gural said amending the ordinance could be done fairly simply and would involve a 30-day waiting period.

Currently, 53 vacant houses are registered with the borough, as required by the 2013 ordinance. Gural said that although the ordinance had encouraged property upkeep, there had not been an uptick in sales of the properties.

"Banks are not responsive to municipalities' concerns," Gural said.

Blame the slow foreclosure process, banks say.

It can take up to four years in court in New Jersey for a bank to foreclose on a property, which delays the selling process, said Tyler Smith, vice president of Wells Fargo's REO Community Development Group in Des Moines, Iowa.

According to Palmyra's records, 14 of the vacant houses are registered to Wells Fargo.

Until a foreclosure is completed, banks can only tend to exterior issues and cannot sell, Smith said.

"Our goal is to sell that property for as much as possible as quickly as possible," he said.

Real estate brokers cite economic and other factors also.

Paul Ciarrochi, a sales representative at Berkshire Hathaway Fox & Roach Realtors in Moorestown, expects sales to improve as the economy gains strength. But he said banks often send appraisers unfamiliar with the area, which results in asking prices that are too high.

Ciarrochi, who lived in Palmyra for almost 20 years, said the River Line's 2004 opening also hurt property values in the borough because of the noise that came with the train.

Adam Veitenheimer, owner of Muse Tattoo & Body Piercing on Broad Street, said today's Palmyra is very different from the Palmyra of his childhood.

"There were a lot of people, a lot of things to do," he said. "Now it's nothing, really - a lot of empty homes."

James Griffin, who has lived in Palmyra since the early 1990s, said the vacant houses had changed the face of the borough in recent years.

"It'd be nice to get people in them," he said.

However, Palmyra still has a lot to offer, Griffin said, calling it a town that combines the best qualities of city and suburb.

Gural said that this year, the borough anticipated collecting up to $75,000 in fees associated with vacant houses.

As of Sept. 1, 2013, the owner of a vacant property is required to register it. For every year the property is vacant, the owner - mostly banks outside New Jersey, according to Gural - faces fees.

The initial registration fee is $500, and there are escalating annual fees - $1,500 for the first year of vacancy, $3,000 for the second, and $5,000 for the third.

Gural said the most difficult aspect of combating the vacant-house problem before the ordinance had been to identify the owners to contact when property issues arose.

The ordinance forced banks to identify themselves by registering their properties with the borough.

Before that, the vacant houses posed a real public health threat, Gural said.

Before the ordinance, borough workers and police had to field numerous complaints covering an array of problems, including break-ins to steal copper plumbing, overgrown yards, and litters of kittens and raccoons taking up residence, Gural said.

Those complaints were taxing for the Police Department, which responds to nuisance calls, and the Public Works Department, which would mow overgrown lawns and handle other exterior property issues, Scheffler said.

Although forcing banks to register the properties mitigated many of the aesthetic and nuisance issues, she said, neighbors want the houses sold.

"We'd prefer family and residents living there," Scheffler said.

Ed Purcell, staff attorney for the New Jersey State League of Municipalities, said levying fees for failure to maintain property exteriors was common in New Jersey.

In South Jersey, Cherry Hill and Collingswood are among those that have vacant-property ordinances. Moorestown also approved an ordinance that will go into effect in late May.

Statewide, lawmakers passed the Abandoned Properties Rehabilitation Act in 2014, Purcell said.

Under that law, towns can levy a $2,500 fine for failing to register or not designating an in-state representative. Additionally, towns can charge $1,500 a day in fines for failing to properly maintain the property.