By Serena Maria Daniels
DETROIT (Reuters) - Detroit may offer city employees a 50 percent discount on homes sold through the city's auction program as part of its efforts to rebound after exiting its historic bankruptcy in December.
The proposal introduced to the City Council on Tuesday is for current city employees, their families and retired city workers. The idea is to encourage families to repopulate devastated neighborhoods that have seen a decades-long exodus by residents.
“Our employees are the city’s biggest champions,” Mayor Mike Duggan said in a statement. “Whether they are renters looking to buy, homeowners who want to restore and move into a bigger house, or employees living in the suburbs who might like to return to the City, we wanted to make it easier.”
The issue will be discussed on Thursday by members of the planning and economic development committee, who will decide whether to recommend it to the full council. If approved, the program could take effect by mid-February.
This latest effort comes as Detroit's eight-month-old Land Bank Authority struggles to shed ownership of 24,500 city-owned properties, mostly acquired over the years when owners failed to pay their property taxes. Buyers had closed on only 154 of the 394 properties auctioned off by the end of 2014, said Craig Fahle, the Land Bank spokesman.
The city had fewer than 700,000 people in 2013, compared to close to 1.9 million in 1950.
Those interested in getting the discount must register as bidders on the Land Bank website and qualify to bid.
“If an employee wins the house with a $10,000 bid, they will pay the Land Bank $5,000,” said Erica Ward Gerson, chair of the Land Bank Board.
Buyers will be required to own the property for at least three years. If they resell before then, they will have to share any profit with the Land Bank - 75 percent in the first year, 50 percent in the second, and 25 percent in the third.
(Editing by Mary Wisniewski and Eric Walsh)