City of blight 

The tough road to recovery for Atlanta neighborhoods ravaged by vacant and foreclosed homes

It was late one spring afternoon in 2007, and Chandra Gallashaw couldn't figure out why her daughter wasn't home from school. She kept calling the 17-year-old's cell phone, but there was no answer.

The 11th-grader had won an ROTC award earlier that day and was still wearing her uniform as she walked home through Atlanta's Pittsburgh neighborhood about a mile south of downtown. She was four doors from her home when a man grabbed her, dragged her onto the porch of an abandoned house and, according to authorities, sexually assaulted her.

Afterward, the girl ran to a nearby ambulance and was taken to Grady Memorial Hospital.

Nearly three years later, the man accused of raping Gallashaw's daughter is awaiting trial, and the house where the crime took place is gone, leaving behind a vacant lot. But that's of little comfort to Gallashaw. Standing on the sidewalk outside her home, she looks up and down her street. "That house is empty, and that one, and that one," she says, pointing to at least a half-dozen boarded-up bungalows in all directions. "That's why no one could hear my baby cry."

Gallashaw is now a board member with the Dirty Truth Campaign, a four-year-old grassroots group bringing attention to the surge of vacant properties and blight that has beset Atlanta's inner-city communities in the wake of the foreclosure crisis. As part of its efforts to spread word of the crisis, the group recruited schoolchildren to take pictures of run-down or abandoned houses in their neighborhoods and provide testimonials about how their surroundings affect their lives.

While the Dirty Truth has few resources beyond its core of volunteer activists and supporters, a host of other organizations, equipped with $12 million in federal Neighborhood Stabilization Program funds and additional millions in private grants, are working to revive Pittsburgh, Adair Park and other hard-hit neighborhoods.

But the solution isn't as simple as new siding and a fresh coat of paint. A recent survey suggests that at least half the houses in Pittsburgh are empty. A short drive reveals what one neighborhood activist calls "Hurricane Katrina without the water" – block after block of boarded-up buildings, overgrown grass, and piles of trash. Some houses sit completely open, just a roof and walls. Squeezed between older homes on Pittsburgh's narrow streets are new, two-story homes with plywood over the windows, products of the nowhere-to-go-but-up fallacy that fed the housing boom.

"Vacant homes are ravaging these neighborhoods and their remaining residents," explains John O'Callaghan, CEO of the Atlanta Neighborhood Development Partnership, which works to support mixed-income communities. "Research shows that every 1 percent increase in the vacancy rate brings about a 2.3 percent increase in crime."

Destabilized neighborhoods have become breeding grounds for violent street gangs such as Mechanicsville's 30 Deep. The stakes for the success of revitalization efforts are high – not just for the affected neighborhoods themselves, but for the future of the city, says Mayor Kasim Reed. If Atlanta can't combat neighborhood blight and get people into some of its now-vacant homes, Reed predicts, "There'll be a reverse of the intown migration and we'll become a second-tier city."

In January, the city learned that its application for an additional $58 million in stabilization funding had been turned down by the U.S. Department of Housing and Urban Development. The news shouldn't have come as a surprise. A December audit showed that almost none of the money in the first round of NSP grants to rebuild neighborhoods had yet been spent -- a phenomenon that managers of the fund attribute to fierce competition to buy the homes. The city now risks losing any funds uncommitted by September.

While the program may have sounded reasonable to its creators in Washington, it's been difficult to get off the ground in Atlanta. A collection of local nonprofit development groups are expected to use the grant money to buy and rehab foreclosed homes to sell them to low-income families. But bottomed-out home values turned Pittsburgh and surrounding neighborhoods into hotbeds of speculation by out-of-state private-equity groups competing with the grant-holders. Those groups have been willing to pay cash for dozens of properties at a time, sight unseen – and because the grant-holders have to observe strict HUD purchasing guidelines, they don't enjoy a level playing field.

"We've got to make bids on up to 10 houses in intown Atlanta just to get one because we're competing with private investors," says the ANDP's O'Callaghan, whose group received $1 million in NSP grants through the state to buy properties across metro Atlanta. The average price for a foreclosed home in Pittsburgh is between $20,000 and $30,000 and rising, he says.

Normally, increasing interest from buyers would signal that the market is functioning properly, but in this case, it's evidence that bottom-feeders are moving in, according to O'Callaghan.

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