California Realtors Associations campaign against eminent domain plan

Richmond’s plan to seize underwater mortgages through eminent domain has come under sharp criticism. Opponents claim that the plan could depress property values, and end up costing the city millions of dollars in lost revenues and legal fees. The West Contra Costa Association of Realtors (WCCAR), which is receiving financial backing from the California Realtors Association, is the latest to join the fray.

In mid-August, WCCAR began the campaign, “Stop Investor Greed,” which is trying to create opposition to the city’s eminent domain plan. Nearly all registered voters in Richmond received a pamphlet in the mail from the group, urging them to oppose the city’s plan. Many people also received phone calls, emails, and Facebook messages.

The campaign is organized by the consulting firm Brown, Mosher, Whithurst, Lowell, & Partners, which also ran the anti-soda tax campaign in 2012. Some residents say the soda controversy divided the city.

According to a representative from the California Association of Realtors, Stop Investor Greed is being financed, in part, by a $70,000 grant from the association. As of late last week, $45,000 had already been spent. The California Association of Realtors also said that WCCAR sought money from the National Association of Realtors, although the national association was unable to return requests for comment.

Supporters of the city’s eminent domain plan charge that outside interests have become entangled in Richmond politics. “This is a community that has come up with a solution to the mortgage crisis that’s in their own control,” said Amy Schur, executive director of Alliance of Californians for Community Empowerment (ACCE), a statewide organization that supports the city’s plan. “How shameful is it that some of these state and national association are trying to mettle and interfere with that.”

Jeff Wright, an independent real estate agent who’s working with Stop Investor Greed, said that if Richmond seizes underwater mortgages, the entire industry might suffer. “This is important across the board,” said Wright. “When there are serious issues, that have broad implications for the industry as a whole, we reach out to the (state and federal) associations, and they respond.”

Chuck Finnie, vice president of media and communications at BMWL & Partners also said that it’s important for Richmond residents to learn about the dangers inherent in invoking eminent domain. “Not only will this plan freeze up the residential credit market, it’s also making it fairly difficult, if not impossible, for the city to conduct its normal municipal borrowing practices,” he said. “This thing is a house of cards that’s about to come down.”

So far only 45 people have signed the group’s petition asking elected officials to abandon the eminent domain plan. Some of those signatures came from employees at BMWL & Partners. 

Councilwoman Jovanka Beckles said Richmond residents are tired of being deceived by big money. “The soda companies did it, they came here and told outright lies,” said Beckles. “Now bankers and realtors are coming in with lies too. But once it’s all over, they’ll leave us with no viable solutions to our problems. We won’t be deceived this time.”

Tonight at 6:30 p.m. Jeff Wright of Stop Investor Greed will discuss the city’s plan to use eminent domain to seize underwater mortgages. It will be at the Police Activities League Gymnasium at 2200 Macdonald Avenue in Richmond.

26 Comments

  1. Toni Hanna

    I am a Realtor who lives in Richmond. I do not support WCCAR’s campaign against the city’s initiative to help struggling homeowners. We as Realtors are sworn to protect the interests of homeowners, not that of the big banks. I am hard-pressed to believe that behind the scenes, the big banks are not funding these inflammatory mailers we are receiving which are full of out-and-out lies. It’s an insult to my profession to read this garbage I’m getting in the mail. A paid lobbyist, Chuck Finnie at BMWL Partners in San Francisco, is hardly the person to speak to what is best for Richmond’s economy and its citizens. The disinformation campaign and Wall Street’s hysterical response to the Mayor’s proposal shows that she must be on to something. From someone who has tried to advocate on behalf of struggling homeowners with the big national banks–they are not on your side and they do not want to help you. The solution being proposed by the Mayor is something of a last resort due to the banks’ inaction and uncaring attitude.

    • Paul Crum

      It is refreshing to read your writing that you are a realtor with a conscience. Most realtors I’ve dealt with in the past have been consumed with their own bottom line. Next time I need a realtor, I want you!

  2. Lynne Therriault

    Tonight I went to the meeting where Jeff Wright spoke about the eminent domain plan. According to an email from Tom Butt, there was supposed to be someone from Mortgage Resolutions Partners who would speak and there would be a free debate on the issue. Stephen Gluckstern bowed out last week so all the audience heard was Jeff Wright’s commentary about the proposal. The whole thing left a very bad taste in my mouth. I am, or at least was, for MRP to help the city take on the banks but why would Gluckstern, or someone in his place, not show up? Not good.

    • Toni Hanna

      Lynne, that is disconcerting news. I don’t know enough about MRP to have an opinion about them of their plan. All I know is that the cynical mailers we have been receiving are really chock full of lies about how real estate really works, and their scare tactics are insulting. They are counting on the ignorance of the populous to scare us into submission. Which happens too often in Richmond, and in politics in general.

      • Tyra

        Can you tell me specifically what the lies are in the mailers that you have received?

        • Toni Hanna

          Tyra, I would need to write you a long essay to point out all the fallacies in their arguments. Just to give you one example–selling a loan, which happens all the time between investors, does not affect our property values. It does not affect our “comps”. A comp is a sale that is listed in the Multiple Listing Service (MLS) which agents use to price their subsequent listings. Selling a loan is not the same as selling a property and transferring title. The city’s idea is to keep the at-risk homeowner in the home, which has no effect as to who’s on title. These mailers are comparing apples and oranges when they claim that the sale of a loan will affect our property values. On the contrary, every time there is a foreclosure or other distress sale, it does affect values in the vicinity of that sale. It seems to me that the point of the Mayor’s program is to keep homeowners in their homes, thereby avoiding blight and distress sales that really do hurt people’s property values.

          • Many of us never received these mailers so we don’t really know what “lies” were being told to the public. I know that I would appreciate more information about what was on these mailers and why some people consider them to be “out and out lies”

      • Jeanne Kortz

        Apprarently Gluckstern was out of town, and the debate had officially been cancelled. The Richmond Chamber of Commerce decided to go ahead anyway with a one-sided information system. I received an email from ROC yesterday afternoon and I wrote back and told them that having a one-sided debate was b.s.

        • Even thought the “debate” had been cancelled, all of the numerous notifications I received over the weekend made it clear that this would now be an informational session.

          At the beginning of the session Jeff explained that the MRP representatives had told them the previous Friday that they would be unavailable and he also informed us that an invitation had been extended to the Mayor and Councilperson Beckles.

          You’re absolutely correct that had this been characterized as a one sided debate it would have been “b.s.”–but it wasn’t, was it? So don;t you think it’s a bit unfair to try to characterize it as something it wasn’t?

          Just curious, were you there or did you watch Michael Parker’s video?

    • Jeffrey Wright

      Please don’t mischaracterize what transpired at the information forum. Every person that was present no matter what their position was on the issue had an opportunity to speak freely in an orderly and respectful manner. It was not just Jeff Wright’s commentary. I question your motives. Why would you even say that? Perhaps Mike Parker of the RPA who is in support of the propsal will let you watch his recording of the event to help “refresh” your memory as to what transpired. Mr. Parker also spoke freely and without interruption like the others, and was providrd with a microphone so that he could be heard. Lynne Therriault were we at the same event?

  3. Kane M.

    I am appreciative of this article and the awareness of this issue it drives. The more residents can understand the factors at play here, and what the effects such a plan would have, the better prepared they would be to make intelligent decisions. It would be nice if the article described how eminent domain will be used, who will be investing, what they will get out of it, what effect it has on the borrower, and the banks. These type of details are often more important that the rhetoric and conjectures of interested parties… but I guess it has to sell…

    What concerns me is something that Toni, above touches on. Why is the associations of realtors financing this? My own experience in our home purchase left me a bit soured when, after all documents were signed, the mortgage broker who was recommended to us by our agent, pressured us to sign a document declaring that we knew he was inhouse. This was especially aggravating when, in the following years, we learned that we were sold into one type of loan whereby we were well qualified for a different, better loan and that the broker was advantaged giving us the loan he did. Yes, we take responsibility for not shopping, but it was on the recommendation of our agent, with whom we knew. This marriage between the banks and real estate associations is deeply concerning in that it is showing that the real estate associations, who represent agents that have a fiduciary obligation to their clients, seem to be in bed with the banks which is violating of a necessary trust.

    The negative effect that foreclosures have on communities and the strain it puts on local governments is tremendous. The crime that increases in blighted areas increases crime and further deteriorates those communities.

    I stand with our mayor and government officials that want to use this tool to protect us and the values of our homes. I am proud of them for showing courage. I am proud of Toni above for coming out as an agent against the misinformation campaign by WCCAR.

    To all you that fight the good fight, thank you.

    • Toni Hanna

      Thank you Kane. Please let me point out that per RESPA (Real Estate Settlement Procedures Act), it is illegal for real estate agents to receive fees from mortgage brokers or lenders, and vice versa. However, RESPA also requires that brokers disclose the existence of affiliated businesses with which you may be doing business in the course of your transaction. That is what you signed. I highly doubt that anyone got a kickback our of your transaction. But it also sounds like you weren’t treated fairly and your best interests were not represented in your particular transaction.

    • Toni Hanna

      P.S. And they should have given you that Affiliated Business disclosure to sign up front, not after you signed all of your loan docs. That indeed sounds unethical to me.

    • Jeffrey Wright

      The West Contra Costa Asdociation of REALTORS is favor of struggling homeowners getting relief, help and assistance. What we are opposed to is the utilization of eminent domain to seize mortgages. Our leadership believes that the negatives far outweigh any potential positives. That’s our opinion and it’s based on our assessment of several factors. If your opinion is different that’s fine. Just as the supporters have every right to promote their position we have every right to promote our position. That’s how it’s done in America.

      • Kane M.

        Thank you for your reply Toni. I am unaware of any backdoor agreements, it was simply a bungled process that allowed me to see into things. As far as institutional partnerships, synergies, etc, given how closely the two industries are tied, I’d be foolish not to acknowledge aligned interested and, therefore, actions.

        @Jeffery, I’m not sure if your comment added anything to the discussion… Oh, and thanks for letting me know “how its done in America”… I have been a licensed real estate agent, currently a homeowner, father, and business owner for several years (brick and mortar) so I think I may have an idea of “how its done in America”… This insulting-to-my-intelligence comment is precisely why I don’t trust you or your leaders… not much different than the mailer they sent out. Emotionally charged rhetoric is so last year. Be substantial.

        • Toni Hanna

          If I belonged to the WCCAR instead of OAR, I would be complaining loudly to the Association about mis-use of my dues money for sure. Slick political mailers full of misleading statements are a mis-use of hard-working agents’ dues money in my opinion.

      • Rich Fife

        Your comment just gave me a Nick Naylor flashback.

        The right to promote a position does not extend to the right to distort the facts.

        Blind appeals to American exceptionalism are a big red flag to me and pretty much every one else. It’s a round world.

        • Toni Hanna

          Say, if you’re interested to see who’s behind the slick mailers we’ve all been getting here in Richmond, check out the lobbyists’ website–which could have been authored by Machiavelli himself–http://whitehurstmosher.com/, from the same people who brought you Nat Bates and No on N. They sure know how to reframe a conversation and create causality where none exists! Take a look at that website and let me know if you think these people can be trusted to provide us with accurate, unbiased information.

    • Paul Crum

      I agree!

  4. Darrin Silverman

    This Eminent Domain plan is a waste of money and foolish. FHA already said they will not make any new loans on these houses that are seized. Banks will stop loaning in Richmond altogether which were hurt all homeowners. The people who had the value of their home reduced might receive huge tax bills from the IRS because the debt reduction was not from a foreclosure or short sale. What happens if the city takes a $400,000 buys it for $250,000 and resells to the owner for $300,000 and the value drops further to $200,000, is MRP and their investors going to adjust it down further where it effects them and their investors. I think not.

    • Bill Davis

      Let me give you a little info about FHA. When Freddie and Fannie had to stop buying bad mortgages, FHA stepped in to pick up the slack and help the housing market keep improving. Now the many mortgages they bought are going bad. At the end of 2012 FHA started a new program. The short of it is they put out distressed mortgages for bid, recently $2 billion. sales went for only 53% of unpaid balance.
      This makes it look like foreclosurers are improving but this program distorts foreclosurers and is actually a write down of principle. The new owner of the mortgage has only 47% invested, so will probably structure a new mortgage. Just another game by the Gov’t to soak taxpayers.

  5. Toni Hanna

    I am re-posting this as a new comment, since my prior comment was embedded in a conversation which you all may not have seen.

    If you’re interested to see who’s behind the slick mailers we’ve all been getting here in Richmond, check out the lobbyists’ website–which could have been authored by Machiavelli himself–http://whitehurstmosher.com/, from the same people who brought you Nat Bates and No on N. They sure know how to reframe a conversation and create causality where none exists! Take a look at that website and let me know if you think these people can be trusted to provide us with accurate, unbiased information.

    • Phil La Mere

      Thanks for keeping us informed, Toni!

      • Toni Hanna

        Phil, you’re welcome, any time. Also check out their Facebook page under BMWL & Partners. You’ll find some interesting insights there about how these lobbyists work. They’re still laughing about subverting our democratic process here in Richmond, including their No on N Campaign, for which they won some big awards.

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