City Of Detroit Calls On Debt Collectors

The city of Detroit has spent almost $50 million since 2004 tearing down deserted buildings. Getting rid of the eyesores has been beneficial, but feeble collection efforts have left taxpayers footing the bill.

After years of brushing aside sending bills for costs of labor, the city plans to start filing lawsuits against the owners of the 40 priciest demolitions of the past six years, which run more than $25,000 apiece.

Some Detroit inhabitants remain dubious. Over the past couple of years, the city has been infamously indifferent about delinquent parking tickets, blight fines, income taxes and the like that amounts to over $200 million.

Late last year, the city and state began tearing down the first of 2,000 eyesores in nine neighborhoods with $20 million in government money. Last week, the federal government added in $41 million to tear down or rehabilitate the houses, and officials are speaking about how this money could be put to the most efficient use.

Starting in February, the city will mail property owners invoices for the expense of the work it took to tear down their buildings. If they don’t pay after 90 days, collection companies who work for commissions will go after the debt. If the debt is large enough, the Detroit law department could get included and file a lawsuit. Although officials concede that the city will only recoup part of the money, the money could go to fund even more demolitions.

Like every public plan, this one has its critics. Some Detroit inhabitants believe that the collections efforts will unfairly target small business owners and underprivileged landlords. One man remarked that it is easy to catch the guy down the street, but not as easy to nab the wealthy property owner in Texas.

Despite the skepticism, Detroit plans to move ahead and send out the invoices next month.

Mallory Megan works for a debt collection company. She also composes articles on business and finance, consumer spending and collection agencies.