Explanation
BACKGROUND: This legislation authorizes the City of Columbus, Department of Development to release its recorded mortgage interests in a residential property (referenced below) that secures two City loans with outstanding balances totaling $56,398.55 made to borrower Viola Williams. The purpose of the release is to enable the City to receive a $10,000 payment rather than receiving nothing if the property is resold through an unavoidable foreclosure action.
The Franklin County Treasurer already conducted a foreclosure action and sold at sheriff's sale the property securing the City's loans in Franklin County Court of Common Pleas case Franklin County Treasurer v. Viola Williams, et al., case number 01 CVE 07-7178. The City was inadvertently excluded from this foreclosure proceeding and, consequently, its interests were not represented. Rather than requiring the County Treasurer to vacate the foreclosure judgment and sale, reopen and re-prosecute the foreclosure suit to include the City's interests, and then resell the property at a sheriff's sale for the outstanding property tax amounts, which would result in the City receiving nothing, this legislation enables the City to receive $10,000 from the current property owner in exchange for the release of its mortgage interests.
The property address is: 920-922 Cleveland Avenue, Columbus, Ohio 43201.
Emergency action is requested to expedite authorization for a settlement.
FISCAL IMPACT: There is no impact on current operating funds. There will be a potential $46,398.55 loss in accounts receivable for Community Development Block Grant Loan Repayments.
Title
To authorize the Director of the Department of Development to release the recorded mortgage interests of the City of Columbus in a property that secures loans with outstanding balances totaling $56,398.55 and to accept $10,000 in exchange for said release; and to declare an emergency.
Body
WHEREAS, the City of Columbus, Department of Development made two Rehabilitation Assistance loans to borrower Viola Williams with combined outstanding balances totaling $56,398.55 and the loans are secured by two recorded mortgages on property located at 920-922 Cleveland Avenue; and
WHEREAS, the release of the City's mortgage interests will enable the City to receive a $10,000 payment rather than receiving nothing if the property is resold through a foreclosure action; and
WHEREAS, it is necessary to authorize the Director of the Department of Development to release the recorded mortgage interests of the City on the property located at 920-922 Cleveland Avenue; and
WHEREAS, an emergency exists in the usual daily operation of the Department of Development, Housing Division, in that it is immediately necessary to release said mortgage interests in order to expedite authorization of a settlement thereby preserving the public health, peace, property, safety, and welfare; and NOW, THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
Section 1. That the Director of the Department of Development be and is hereby authorized to release the City's recorded mortgages on property located at 920-922 Cleveland Avenue that secure the City's outstanding loan amounts totaling $56,398.55 in exchange for payment of $10,000 to the City from the current owner Don Schlater.
Section 2. That for the reasons stated in the preamble hereto, which is hereby made a part hereof, this Ordinance is hereby declared to be an emergency measure and shall take effect and be in force from and after its passage and approval by the Mayor, or ten days after passage if the Mayor neither approves nor vetoes the same.