Vacant buildings cost a community considerably due to impacts on property values, lost tax revenue, increases in police/fire calls and code enforcement services, and potential hazards to the public and public safety first responders. The registration program allows the City to keep track of vacant commercial/industrial buildings, ensure they are maintained in a safe condition, and recover a portion of their disproportionate costs to the community. Vacant building registration was a high-priority recommendation of Xenia’s citizen-driven X-Plan, which highlighted the need to reposition vacant buildings for revitalization.
The problems associated with vacant buildings and the costs they create for local governments are well-documented and have been tragically proven on some occasions, as explained below:
Police demand. Vacant buildings are susceptible to illegal activities such as squatters, vandalism, theft, and arson due to a lack of on-site supervision or security.
Fire protection hazards. Thousands of fires break out in vacant structures each year in the US, mostly resulting from arson, resulting in tens of millions in of dollars in property damage. Fires in vacant buildings lead to thousands of firefighter injuries every year and have even led to deaths of firefighters in instances such as Worcester, Massachusetts (1999) and Chicago (2010).
Code enforcement. The lack of supervision associated with vacant buildings often coincides with a lack of maintenance, leading to accumulations of trash, tall grass/weeds, and neglect of building maintenance. The process of identifying and contacting owners requires a disproportionate amount of code enforcement staff time. These buildings also create direct costs for local governments associated with actions such as boarding up, mowing, and demolition.
Local government costs. A 2008 study conducted by Community Research Partners conservatively estimated that annual costs from code enforcement, fire and police protection, and tax loss associated with vacant buildings ranged from $20 per household in Columbus to $200 per household in Dayton and Cleveland. Lost property tax revenues account for 75% of this impact.
Lower property values. Prolonged vacancy creates uncertainty for surrounding property owners and can signal that a neighborhood is on the decline. Lack of adequate maintenance can create eyesores that detract from the desirability of a neighborhood. Studies have shown, at least with residential properties, that properties located on the same block or otherwise within close proximity to an abandoned property are generally reduced by $4,411 to $8,750 (according to the 2008 Community Research Partners study).
Lower tax revenues. Lower property values lead to lower property tax collection. In commercial/ industrial buildings, vacancy means a lost opportunity for income tax generation. Tax delinquency is also often correlated with vacancy. If a property must be demolished due to deferred maintenance, then taxable revenue is reduced even further.