Los Angeles City Councilman Eric Garcetti is pushing to pass a local ordinance that would hold banks accountable for foreclosures.  The law is permissible under the Mortgage Relief Bill, a state law that directs banks to maintain foreclosed properties or be fined. The law would require banks to secure foreclosed properties, remove trash or debris and cover the cost of public safety responses to criminal activity at foreclosed homes. 

There are more than 25,000 foreclosures in Los Angeles, according to data from Realty Trac and the Center for Responsible Lending.  Latimes.com reported a single foreclosure can cost the city between $5,000 to $35,000.

L.A. City Councilman Richard Alarcon is also in support of the new law that some say will hold banks accountable.  Alarcon wrote in a statement: “Abandoned foreclosed homes lower neighborhood property values, hinder community safety and are a drain on City coffers.  I refuse to let taxpayers foot the bill when banks are responsible for the maintenance of these properties…

It’s time for local governments to hold banks accountable--and we can do that together by taking action today.”

The banks ATVN talked to said they hadn’t heard about the ordinance City Councilmembers are advocating, but Beth Mills with the California Bankers Association released the following statement to ATVN: “In July 2008, legislation that we supported was passed in Sacramento that gave local governments the authority to fine banks for not maintaining properties. It is not the banks’ responsibility to renovate homes they probably inherit in poor conditions.”